The Tax Policy Blog

July 23, 2014

The House Committee on Ways and Means amended the Student and Family Tax Simplification Act last Thursday and has issued a comprehensive report on the bill. The bill, or H.R. 3393, was developed by Representatives Diane Black (R-TN) and Danny Davis (D-IL) in an attempt to further mitigate post-secondary education...

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July 23, 2014

Recently Spain announced that it is increasing the country’s taxation rate on total bank account deposits to 0.03 percent. New revenues from the tax will be distributed to each of Spain’s 17 regional governments to help them pay for budget shortfalls, which the federal government prohibits from being greater than...

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July 22, 2014

The recent death of Eric Garner after an incident with New York police has recently made headlines and sparked controversy about excessive force and police practices. Sources report that police and...

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July 22, 2014

Australia is the first developed country to both institute and repeal a tax on carbon. On Thursday, July 17, the Australian Senate repealed its carbon tax with a 39 to 32 vote.

After the repeal, Prime Minister Tony Abbot characterized the tax as destructive to jobs, families and the economy, without actually helping the environment. “The Carbon Tax was a $9 billion a year hit on the...

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July 22, 2014

A law professor wrote an article discussing our work ensuring state tax guidance to same-sex couples after DOMA was struck down. About half the states both (1) require state tax return filing status to match the federal tax return filing status and (2) ban gay marriage. As these together create a paradox for taxpayers, we worked with states to provide affirmative guidance and options,...

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July 22, 2014

This November Massachusetts will vote to repeal House Bill 3847. The law, signed in 2013, raised the state’s gas tax from 21 to 24 cents per gallon and automatically tied the tax rate to inflation for future years. Despite opposition by the group Tank the Gas Tax, which successfully gathered...

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July 21, 2014

A tax expenditure is defined as a departure from the default tax code that decreases total taxes paid. They are called tax “expenditures” because they resemble government spending.

Although a majority of tax expenditure spending can be accounted for by a small number of...

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July 21, 2014

Transportation Security Administration (TSA) per-passenger fees rise today, from $2.50 for non-stop flights and $5.60 for connecting flights to $5.60 for all flights. I’ve written about this fee hike before, discussing how direct airline ticket taxes and fees can be a...

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July 18, 2014

If you buy something in Philadelphia, you pay a 8 percent sales tax (6 percent state plus 2 percent city). But if that something is an amusement (sporting event, theatre performance, show, etc.), the state doesn't tax it although the city taxes it at 5 percent. Why such purchases should get preferential tax treatment is beyond me, but it's also led to disputes over what counts as an "amusement" and what doesn't.

Philadelphia Mayor Michael Nutter's administration argued that lap...

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July 18, 2014

The corporate inversion debate continues to heat up, revealing a serious conflict between the Obama administration and the business community. Corporate inversions are cross-border mergers that allow U.S. companies to reincorporate abroad where corporate taxes are much lower.

Earlier this week, Abbott Laboratories and Mylan Inc., both U.S.-based drug makers, announced yet another inversion deal, this time a “...

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July 17, 2014

On Tuesday, the Nebraska Department of Revenue released the state’s 2013 annual tax incentives report, which describes the various business tax incentives in the state as well as their effects and beneficiaries. The department reports that this year the state spent around $200 million on tax credits which generated nearly $1 billion of capital investment and 2,300 full-time jobs,...

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July 17, 2014

Rhode Island is one of the worst-scoring in the State Business Tax Climate each year, but there have been small attempts in the last decade at moving the state toward a more competitive code. In 2010, the Rhode Island brought the top income tax rate down to 5.99 percent, and this year, the corporate rate will be lowered two percentage points, paired with an increase...

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July 17, 2014

One of the common themes in the debate over corporate inversions is that these transactions will erode the U.S. tax base and cost the Treasury billions of dollars in lost taxes.

What is interesting is that the latest IRS data for 2011 shows that the U.S. subsidiaries of foreign corporations pay a higher effective tax rate than do all active corporations in general. The IRS ...

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July 16, 2014

In a recent letter to Congress’s tax writing committees, Treasury Secretary Jacob Lew wrote that Congress should act to prevent U.S. corporations from inverting (the practice of a U.S. company merging with a foreign company and moving its headquarters to the foreign country).

In doing so, Lew writes that corporations that invert “seek to shift their profits overseas to avoid paying their fair...

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July 16, 2014

The Tax Foundation has released a new report that looks at the effects that tax credits for higher education have had on the rising costs of college tuition. The report explains how the credits have expanded, how they disproportionately benefit higher income families, and how they have failed to stop the increase in student loan debt. Additionally, it examines how, instead of being a...

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Subscribe to Tax Foundation - Tax Foundation's Tax Policy Blog The Tax Policy Blog is the official weblog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.

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