Blog Post Round-Up

  • Cap-and-Trade and Econ 101: Supporters of cap-and-trade in the political arena will rarely admit this because the word “tax” carries a negative connotation, whereas “regulation to protect the environment” sounds good to voters, even though they are both designed to raise the price of energy consumption/production.
  • Film Tax Credits: Lower Taxes for Celebrities, Higher Taxes for You: Lawmakers purchase favorable media coverage for themselves, film companies accept payment for filming in economically unprofitable places, and taxpayers finance the deal. It’s hard to see how that’s good policy.
  • Hawaii Taxpayers to Get $1 of State Budget Surplus: The Hawaii Constitution requires that the state refund taxes to taxpayers if the general fund is in surplus by at least five percent for two years. Obeying the letter of the law, the state legislature enacted a $1-per-taxpayer income tax credit, which will be paid out on the 2009 tax return.
  • National Association of Realtors: Housing Poised for Rebound (i.e. Buy Now!), But Stimulus Is Needed: While the housing market downturn has its downsides, one of the benefits is watching organizations like the National Association of Realtors try to talk out of both sides of its mouth.
  • Capital Gains Tax Continues to Roil Economic Debate on Anniversary of Bush Tax Cut: The 2003 tax cut for capital gains was JGTRRA’a most controversial provision for two reasons. First is the Democratic Party theme that capital gains should be taxed at least as heavily as wages, and second is the Republican Party theme that cutting capital gains taxes invariably raises revenue.
  • Municipal Bond Exclusions Help Shield High-Tax States From Tax Competition: A reader wrote in after reading this post on the Kentucky v. Davis outcome, asking for more information about why states’ practice of excluding municipal bond interest income is problematic. [O]ne of which is that the exclusion helps shield high-tax states from interstate competition that could bring down tax burdens.
  • Rethinking Veterans’ Tax Benefits: While criticizing any policy that expands benefits to those who serve in the military is not likely to be very popular on the surface, policymakers and the general public who truly believe that it is in our country’s interest to compensate those who serve in the military need to realize that the tax code is not always the best vehicle for doing so.

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