2013 was a year of many changes to the U.S. tax code, and some of the most significant changes were targeted at raising taxes on high-income Americans. The fiscal cliff tax deal created a new 39.6 percent income tax...
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- Links: A 20 Percent Tax on Guns, Fuel Tax Fraud in Europe...
Links: A 20 Percent Tax on Guns, Fuel Tax Fraud in Europe, and Fat Joe Evades Taxes but Not Prison
California is considering a measure to eliminate the tax exempt status of a select group of non-profits that the state deems discriminatory. These organization include the Boy Scouts and Little League, and could potentially include some public and private schools. The measure has already passed the state Senate.
This op-ed says that the IRS scandals highlight the need for a flat tax. The trouble with an outright shift to a flat tax is that it ignores the biases against savings in the current tax code. Not all the loopholes are actually loopholes, but some iterations of the flat tax would eliminate them all anyways. In fact, many tax expenditures help move us towards a more neutral tax base (e.g. exclusions for retirement savings and lower rates on capital gains). The author is right that the code needs to be simplified, but we need to do it in the right way.
Rapper “Fat Joe” reported to prison to serve a four month sentence for tax evasion. In December he pled guilty on failing to pay income taxes on more than $1 million in income from 2007 and 2008.
Fuel smuggling and fraud has cost Europe $4 billion in tax revenues. Due to the tax competition between countries in Europe, “[t]here are price incentives to move fuel from one part of Europe to another.” (We’ve seen a similar case with cigarettes in the U.S.) Some governments in Europe have responded by making their tax laws more competitive with those around them. One Czech refinery expects the tax changes to cut the amount of illegal trade in half.
A Bloomberg article looks at the similarities and differences between the tax reform debate in 1986 and now. The 1986 act was years in the making, stemming from the 1981 tax cuts and a president dedicated to tax reform. Today, the tax reform debate appear stuck in the static box of revenue neutrality. Instead, tax reform should focus on economic growth.
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