The Obama Administration yesterday backed down from its plan to tax the earnings on 529 savings accounts, a kind of saving account for higher education under section 529 of the tax code. At Bloomberg, Richard Rubin and...
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- Clearing the Decks for Hurricane Rebuilding
Clearing the Decks for Hurricane Rebuilding
As yet another hurricane hammers the Gulf Coast region today, we've just released a new analysis of how the state of Mississippi can clear the decks for economic redevelopment by cleaning the weeds out of its state and local tax codes. An excerpt:
As the nation prepares for a massive rebuilding effort in the Gulf Coast region, policymakers in Mississippi should also consider rebuilding their tax system. While federal incentives may encourage companies to invest in the region in the short term, Mississippi’s state and local business climates will be considerably more important for economic development in the long term.
Congress has already passed an aid package worth over $60 billion for the afflicted areas, in addition to $6.1 billion in federal tax incentives for the disaster zone. Ideally, reforms should focus on creating an environment where capital formation is encouraged and entrepreneurship is allowed to flourish. Mississippi should focus on encouraging companies to invest in the state for the long-term, not just during the immediate aftermath and rebuilding period.
The logic of the piece extends beyond Mississippi, and applies equally to the entire Gulf Coast region. Be sure to see the laundry list of suggested repeals from Mississippi's tax code at the end.
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