"since every economic theory agrees that capital formation is key to long-run growth." Not true. Modern growth theory and lots of supporting evidence argue that "technical progress" is and always has been the key to long-run growth. The difference is important for policy-making. Taxes that encourage capital formation do not necessarily encourage R&D, which in some form has always been the source of technical progress. For example, a dividend tax can encourage R&D by reducing the number of firms in an industry and thus raising the rate of return to R&D enjoyed by the remaining firms. The interplay of taxation and growth is not as simple as it seems on the surface.