High debt loads and the ability to deduct the expense comprise the life blood of PE firms. Black’s Apollo Global Management and Kravis’ KKR & Co. purchase companies by putting down about 30 percent and borrowing the rest of the cash. By deducting interest on loans, PE-backed companies slash their tax rates by more than half, according to a 2010 study from Notre Dame Professor Brad Badertscher. Ryan’s plan would tax businesses on their net cash flow giving them the incentive to spend more and borrow less. The House Speaker and Apollo declined comment. KKR did not return calls.

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