Leaders of prominent conservative groups are urging the Trump administration to issue an executive order to index capital gains taxes to inflation, arguing that doing so would end taxes on "phantom income."

"For much the same reason that regular income tax brackets were indexed to inflation over 30 years ago, we believe that it is only a matter of fairness to do the same for capital gains," the conservative leaders said Monday in a letter to President Trump Donald John TrumpBiden leads Trump by 36 points nationally among Latinos: poll Trump dismisses climate change role in fires, says Newsom needs to manage forest better Jimmy Kimmel hits Trump for rallies while hosting Emmy Awards MORE and Treasury Secretary Steven Mnuchin Steven Terner MnuchinLawmakers fear voter backlash over failure to reach COVID-19 relief deal United Airlines, unions call for six-month extension of government aid House Democrats plan to unveil bill next week to avert shutdown MORE.

Under current law, when people sell investments, they pay taxes on the difference between the amount they sold the investment for and the amount for which they purchased it. But the conservatives argue that taxpayers' actual gains are lower than the amount that's currently taxed because of inflation.

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"For example, if someone saving for retirement purchased an S&P index fund for $1,000 in 2008 and dutifully held it for ten years, they could now sell it for $1,934. That’s a gain of $934," the conservative leaders wrote. "Unfortunately, the full amount would be subject to taxation. But $168 of that $934 isn’t a real gain at all. It’s phantom income that was eaten away because of inflation. And yet, taxpayers are currently forced to pay taxes on this nonexistent income."

The conservatives argue that indexing capital gains to inflation would boost the economy and encourage people to save more for the future.

"By preventing the money from unjustly going to the government, it could be re-invested in the economy, allowing businesses to expand, innovate, and create more jobs," they wrote.

The signers of the letter also said that an executive order on capital gains would help to build on the tax law Trump signed in December.

"Now that tax cuts has been successfully passed into law, we believe now is the right time to continue your successful leadership in bringing about real economic growth through additional tax cuts," they wrote. "This executive order would do just that."

Conservative leaders who signed the letter include Club for Growth president David McIntosh, Americans for Tax Reform president Grover Norquist and Heritage Action vice president Dan Holler.