The Tax Policy Blog

June 19, 2014

A new report by Michigan Future, Inc. focuses on Minnesota, claiming to show how Minnesota has maintained a high level of economic prosperity despite being a high-tax state. After a detailed look at Minnesota’s tax policies, the report claims that Minnesota’s strong economy is due to investing “additional revenue in services and investments that matter in a knowledge-based economy,” which means, broadly, higher...

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June 19, 2014

The Federal Highway Trust Fund is going bust this year. In fact, it goes bust every year. According to the Committee for a Responsible Federal Budget (CRFB), federal highway spending has exceeded dedicated tax revenue in 13 of the last 14 years. The shortfall is projected to be about $15 billion this year and $170 billion over the next 10 years. As shown in their chart,...

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June 19, 2014

Senators Chris Murphy (D-CT) and Bob Corker (R-TN) yesterday called for a twelve-cent increase in the federal gasoline and diesel taxes. The increase would phase in over two years, bringing the tax on ordinary gasoline up from 18.4 cents to 30.4 cents per gallon. From then on, the tax would be indexed to inflation. (The diesel tax would go from 24 cents a gallon to 36.)

This is a simple...

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June 18, 2014

Today the House Judiciary Committee voted to approve legislation to permanently extend the moratorium on taxation of internet access.

The bill, titled the Permanent Internet Tax Freedom Act, would make permanent the current internet tax moratorium that prevents states and localities from levying taxes on access to the internet. It would also eliminate a grandfather...

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June 18, 2014

A new report from the Department of Health and Human Services on Obamacare exchanges suggests that the magnitude of the subsidies (administered through a refundable tax credit) will be larger than previously expected. The Los Angeles Times reports that the total cost of subsidies may be $16.5 billion this year.

These subsidies were projected to become the largest refundable...

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June 18, 2014

The federal fuel tax sounds like it could be a simple excise tax. In a world with competent, broad-based tax policy, we could see such a thing. In America, we get IRS forms 720, 4136, 8849, 6478, and 8864.

A broad federal fuel tax makes some sense. There is federal spending on a variety of things (for example, the United States Highway Trust Fund) that directly benefits people in approximate proportion to their fuel usage. Rather than make these services “free,” which leads to...

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June 16, 2014

The cost of America’s extremely high corporate tax rate continues to pile up. The Wall Street Journal reports on yet another tax “inversion” deal:

Medtronic Inc. ...

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June 13, 2014

A recent National Bureau of Economic Research working paper assessing optimal sales tax policies has found that exempting some services (like health and education) from a hypothetical national sales tax would amount to only a 3 percent revenue loss. They also find that charging different rates on different categories of goods rather than a flat sales tax rate can improve society-wide “utility” (how well off people feel) by 30 percent for any...

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June 12, 2014

The California Senate Governance and Finance Committee yesterday passed a bill that would prohibit sports franchise owners from writing off fines imposed by the league as business expenses on their state income tax returns.

The law is fairly unapologetically aimed at Los Angeles Clippers owner Donald Sterling, who was fined $2.5 million by the NBA for making racially offensive...

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June 12, 2014

Both employers and unions across the nation have continued to realize the burdens of Obamacare. A recent survey of 360 large employers has shown business leaders’ discomfort with many provisions of the Affordable...

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June 12, 2014

Last Thursday, the Census Bureau released its annual report on state government tax collections, showing that state government revenues from taxes increased 6.1 percent between 2012 and 2013. This marks the third consecutive year that collections have increased since the recession – for a total 18.6 percent increase in nominal terms since 2009.

...
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June 12, 2014

The race horse, California Chrome, recently in the news for his attempt at the Triple Crown, may be different than other horses according to the IRS, and it all has to do with the complicated depreciation system in the U.S.

The tax code has different guidelines on how all horses are to be treated depending on the...

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June 11, 2014

Congress appears deadlocked over how to plug a $100 billion shortfall in the Highway Trust Fund over the next six years. Some members are looking for a short-term funding solution that would keep the fund from going broke in late July or early August, while others are looking for long-term solutions that would put the trust fund on a sound financial footing through 2020.

Unfortunately, many of the leading proposals to fix the trust fund crisis...

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June 11, 2014

The New York Times’ The Upshot uses Dave Chappelle’s recent appearance on the “Late Show with David Letterman” as an opportunity to discuss the need for high top marginal tax rates.

From The Upshot:

"'So I look at it like this,” Mr. Chappelle said. “I’m at a restaurant with my wife. It’s a nice restaurant. We’re eating...

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June 11, 2014

This week, Americans for Tax Fairness, released a report on how much they believe the U.S. government would lose in revenue over 5 years if Walgreens were to merge with a Swiss company and move their headquarters to Switzerland.

The report claims that the deal would save Walgreens $4 billion in taxes over five years it would have to pay to the U.S. government, but it worries that Walgreens “would continue to take full advantage of all the benefits it gets from operating in America,...

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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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