The Tax Policy Blog

March 20, 2007

In yesterday's article on Gov. Blagojevich's new tax proposal, Crain's Chicago Business asked the Governor Blagojevich's office to respond to a recent Tax Foundation study.

Sadly, representatives of the governor's office chose not to defend their own tax proposal, maybe because it is indefensible. Instead, a spokesman lobbed...

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March 19, 2007

Economists often complain about the costs of a complex tax code. In our own latest estimate, we found U.S. taxpayers bear about a 22-cent surcharge for every dollar of federal income taxes paid, in the form of time and effort spent keeping records and filing tax forms each year. Economists teach that these costs are "deadweight losses" to the economy, representing pure economic waste that doesn't make anyone better off.

However, some have argued...

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March 16, 2007

Iowa is the latest state to put in place a cigarette tax hike under the guise of funding new health care programs. From the Des Moines Register:

The price of cigarettes is climbing by a dollar a pack in Iowa as a result of a tobacco tax increase signed into law Thursday by Gov. Chet Culver.

Culver said the higher taxes will prod thousands of...

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March 16, 2007

Representative Charlie Rangel, Chairman of the House Ways and Means Committee, released a statement expressing concern about the fact that Halliburton moved its corporate headquarters to Dubai. In his statement he partially blamed the tax code, saying that this was:

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March 15, 2007

Property taxes are not popular with taxpayers in any state, but as we have written before (here, here, and here), they have recently been an especially contentious issue in Pennsylvania.

Issues PA, an initiative of the Pennsylvania Economy League, recently conducted two surveys on the topic, one of legislators and one of...

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March 15, 2007

Over the last century the cost of complying with the federal income tax has risen drastically, due to the ever-increasing complexity of the tax code. In 2005 Americans spent an estimated 6 billion hours complying with the federal income tax code, with an estimated compliance cost of over $265.1 billion.

From Tax Foundation Special Report No. 138, The Rising Cost of Complying with the Federal Income Tax, which examines the cost of tax compliance in...

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March 14, 2007

We have posted an interview with U.S. Senator Orrin G. Hatch (R-Utah) as yesterday's Tax Policy Podcast. Sen. Hatch discusses the benefits of two types of health care reform: health savings accounts and the President's proposed plan to equalize the tax treatment of people who purchase health insurance on their own and those who receive it through their employers. The Senator addresses several criticisms of these plans and discusses the importance of reform.

To...

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March 14, 2007

Lawmakers looking for a way to raise tax revenue without increasing taxes have decided the pot of gold rests with closing the so-called "tax gap." The tax gap is the difference between what the IRS says people owe and what they pay.  Estimates of the tax gap are roughly $300 billion annually.

A number of proposals to address the problem have been floated, but no one has any solid estimates as to how much...

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March 12, 2007

It's exasperating to wait two years for preliminary data on income taxes, but 134.5 million tax returns can't be tallied overnight.

That's how many tax returns American individuals filed in the spring of 2006 when paying 2005's taxes, according to new data from the IRS's Statistics of Income Division.

Other important numbers for tax year 2005, compared to 2004:

Up 8.9 percent: Adjusted Gross...

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March 09, 2007

In his State of the State Address on Wednesday, Illinois Governor Rod Blagojevich put forth a tax increase to fund higher spending on children's health and education, which included the imposing of a gross receipts tax on the state (See blog post below). Regardless of how high the governor may want to increase spending (even if he wanted to triple it), a gross receipts tax is the one of the worst ways to raise the revenue for that spending.

In his...

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March 08, 2007

Typical reporting on the alternative minimum tax looks like this:

The AMT was created in 1969 to prevent a handful of the uberwealthy from being able to avoid paying federal income taxes, but due to [enter a host of reasons here], tens of millions of middle-class (or "middle-income") Americans will now be hit by the AMT.

It is...

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March 07, 2007

On Monday, the Joint Committee on Taxation released a new report on the Alternative Minimum Tax (AMT). The report highlights how the AMT, if left alone, would grow over the next three years, then fall dramatically in 2011 with the expiration of the Bush tax cuts, and then begin to rise again thereafter. The report was prepared by JCT for today's Ways and Means Committee...

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March 07, 2007

In his state of the state address today, Illinois Governor Rod Blagojevich proposed a new business gross receipts tax to raise $6 billion for general fund expenses (largely education and health care). While Illinois may need more money for public services, imposing a gross receipts...

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March 05, 2007

This is a letter-to-the-editor I sent to the DesMoines Register in response to columnist Gary Maydew's article To attract businesses, think beyond tax rates.

Gary Maydew may be an excellent accounting professor, but he needs to brush up on his statistics. He ran a simple correlation between the Tax Foundation's ranking of business tax friendly...

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February 28, 2007

Yesterday we posted a Tax Policy Podcast interview with Mark Weinberger, who is the Americas Vice Chairman for Tax Services at Ernst & Young and a former Assistant Secretary for Tax Policy at the U.S. Treasury. 

Weinberger discusses with Tax Foundation President Scott Hodge some of the more pressing tax policy problems our country faces today, as well as the necessity for cooperation--both between the parties and between Congress and the Administration--in...

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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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