Hidden Tax Increases in the New Tax Bill
May 23, 2006
At the Maine Heritage Policy Center’s new blog, former Tax Foundation economist J. Scott Moody highlights the “revenue offsets”—that is, tax increases—enacted along with the recently passed “Tax Increase Prevention and Reconciliation Act of 2005”:
The Joint Committee on Taxation has estimated the tax cut at -$69 billion over the next 10 years. What you won’t hear about is the $21.8 billion of “Revenue Offset Provisions” otherwise know as tax increases.
Looking over these tax increases is not for the faint-at-heart as they are full of tax minutia that only a tax accountant could love. There are 13 of these tax increases including the “Application of earnings stripping rules to partners which are C Corporations ($284 million over ten years)” and “5-year amortization of geological and geophysical costs for major integrated oil companies ($189 million over ten years).”…
[M]any of these tax increase provisions result in the shifting of the tax burden from individuals to businesses thereby further reducing tax transparency.