According to 2011 Census data, there are approximately 27 million businesses in the United States. Of these 27 million businesses, 90 percent of them are what are called “pass-through” businesses.
In regard to...
We released a new study today examining the economic justification for the federal income tax deduction for charitable gifts.
From the perspective of economic efficiency, it turns out it's hard to justify the current size and scope of the federal charitable deduction. Most 501(c)(3) public charities now benefiting from the deduction are neither charitable, in the sense of relying mostly on altruistic gifts, nor are providers of what economists call "public goods."
Here are two charts that tell much of the story. First, the charitable deduction's benefits are highly regressive:
Second, most 501(c)(3)s actually rely mostly on program revenues—e.g., tuition from college students or admission fees at art galleries—and government grants for funding, casting doubt on the notion that they wouldn't be privately provided in the absence of a federal tax subsidy for them:
The full paper is available here.
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In regard to...
Michigan’s Senate approved a bill yesterday to extend the state’s film tax credit program, which was limited and reduced in 2011 and set to expire in 2017. It’s now up to the House to decide whether to proceed. From...