The Tax Policy Blog

December 21, 2007

There's a lot of talk of silly tax policy now-in-days. Every politician seems to have some funny gimmick that will tax some group to pay for a program for some other group. So with the holidays upon us, here's a list of new taxes we wouldn't be surprised (for better or usually for worse) to see proposed:

Egg nog and Christmas cookie "fat" tax

They are staples of the holiday diet, but they're also the cause of the ever-expanding American waistline. Therefore,...

Continue Reading...
December 21, 2007

Inflation adjustments for tax brackets, exemptions, and deductions will mean that your first paycheck in 2008 will be slightly higher than your last paycheck of 2007, even if your salary remains the same. While the increase this January will not be nearly as large as last January, it will still be noticeable.

For a single person earning $50,000 per year (assume all wages/salaries and no adjustments), his federal individual income tax bill under...

Continue Reading...
December 20, 2007

It has been a common theme recently for elected officials to go after cigarettes for a tax hike to pay for some spending program that is supposed to provide general public benefits. What is the justification of this type of policy from the perspective of sound public finance? Unless one wants to argue for an across-the-board switch to Ramsey Rule taxation, there is none. It's pure democratic politics: use the coercive power of the...

Continue Reading...
December 20, 2007

Today, President Bush signed into law a new tax law that puts in place a three year exclusion from income of mortgage debt forgiveness. Currently, individuals who receive forgiveness of their mortgage must claim the forgiveness as income on their IRS tax forms. This change in tax law is bad tax policy for two reasons. First, it's temporary. If mortgage debt forgiveness should not be taxable income, then why should somebody who is in financial trouble in 2008 be more deserving of somebody...

Continue Reading...
December 19, 2007

A new survey on tax attitudes by Bankrate.com finds that despite the complexity of filing an income tax return, most Americans don't want the government to fill it out for them.

Two-thirds of Americans would prefer to maintain control over their tax returns (65 percent) rather than let the government prepare their returns, if given that option.

And the IRS doesn't want that responsibility either. They'd rather take whatever money would be required to...

Continue Reading...
December 19, 2007

Although it is likely that Congress will pass an AMT patch today and send it to President Bush for signature, it is still an interesting question to ask what the economic ramifications would be if the patch wasn't passed versus its passing.

The main downside to a patch from an economic efficiency perspective is that a patch for 2007 tax law would not change economic behavior (for the better) for 2007 as it has already been done. Because of this, there is little, if any, Laffer curve...

Continue Reading...
December 19, 2007

The House of Representatives has passed a patch for 2007 tax law to prevent about 20 million new tax returns from being hit with the Alternative Minimum Tax. The bill now awaits President Bush's signature. The bill passed 352-64. (All those opposing were Democrats.) Here is the roll call vote record.

Following Bush's signature, the AMT exemption amounts for 2007 are as follows:

Married Filing Jointly: $66,...

Continue Reading...
December 18, 2007

If there were a future's market on whether an AMT patch is going to be passed by this weekend (before Congress recesses for the year), the odds would most likely still be yes, but the stock would be falling. The latest from the Washington Examiner:

The congressional struggle over how to protect millions of middle-class people from getting soaked by the alternative minimum tax this year...

Continue Reading...
December 18, 2007

We're looking for bright, motivated college students to fill open spring and summer internships. More information on the Tax Foundation internship program and application is here. Spread the word to friends and family who might be interested!

Internship Areas

Economics & Public Policy interns work with our team of economists on issues at the federal and state levels, with emphasis on data...

Continue Reading...
December 18, 2007

55,000 Egyptian tax department employees are returning to work after a work stoppage where they demanded higher wages:

Continue Reading...
December 18, 2007

It's hard to say no to children in need. The desire to help children is so fundamental that it can be hard for some people to reject poor public policy if it's enacted in the name of needy kids. This conflict between the desire to protect children and the desire to enact sound fiscal policy is at the center of the S-CHIP debate, a topic we have written about numerous times (here, here and...

Continue Reading...
December 18, 2007

With the recent surge in the polls of Republican presidential candidate Mike Huckabee, the FairTax is a hot topic these days. The FairTax, which would replace the current income, payroll, estate and corporate income taxes with a national retail sales tax, has a large following of grassroots supporters, as well as many members of Congress (Senate and ...

Continue Reading...
December 17, 2007

We've already written extensively on Maryland's recent tax hikes:  income, sales, and cigarette tax rates will go up next month.  Governor O'Malley's original plan would have also extend the state sales tax to "luxury" services, including real estate management, landscaping, tanning, massage therapy, auto repairs, and health club memberships. 

... Continue Reading...
December 17, 2007

It turns out that Illinois Governor Rod Blagojevich, the man who vehemently argued earlier this year that corporations are avoiding paying their fair share in taxes to the State of Illinois, may be avoiding paying his fair share -- to the IRS. An AP article cites how Blagojevich has used large sums of state-funded travel since taking the governorship in 2003, some of which could be considered part of adjusted gross income according to federal tax law. Here's the story from...

Continue Reading...
December 14, 2007
  • USASpending.org—the federal government's new searchable database providing information about all federal grant and contract spending above $25,000—is launched. This year's Coburn-Obama Act required the creation of the database.
  • House of Representatives votes 226-193 to pass a one-year revenue-neutral AMT patch, which would increase...
Continue Reading...

Pages

Follow Us

About the Tax Policy Blog

Subscribe to Tax Foundation - Tax Foundation's Tax Policy Blog The Tax Policy Blog is the official blog 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.

Monthly Archive