David Brunori, Worst Tax Idea of the Year? Cuomo Wins by a Landslide:
An ideal tax system is based on a broad base and low rates. At least that is what the thinking folks believe. An ideal tax system also treats similarly situated people and organizations the same. People concerned about fairness have always thought that. And an ideal tax system minimizes economic distortions. Now politicians of every stripe violate that ideal every day. Personally, I think politicians violate this idea because 1) they arrogantly want to dictate their views on the rest of us, or 2) they want to enrich their friends.
Now the Governor of New York wants to create tax-free zones:
Not everything, everyone, or everywhere in New York will be tax-free. The tax-free communities will be all of the state universities (and curiously a number of private universities) outside New York City. Companies that open shop in these communities will be exempt from sales, income, and property taxes. That’s better than living in New Hampshire. Better still, employees who work for businesses in the new tax free communities will be exempt from paying state income taxes.
So if you are in the community you don’t pay tax. If you are outside, even by six inches, you do.
I agree that this is a terrible idea, as is. But if Governor Coumo is willing to go further and create libertarian free cities in his state, that would be pretty cool. Galt’s Gulch, NY could give the Free State Project in neighboring New Hampshire a run for its money.
William McBride, CBO: Tax Expenditures in the Eye of the Beholder. With this handy chart:
TaxProf, The IRS Scandal, Day 21
Why did the IRS scrutinize “conservative” and “tea party” applications? It’s clear the orders came from Washington. Who ordered it? The IRS employees in Cincinnati were most likely just following the orders from Washington. Someone came up with the idea to have this scrutiny.
It clearly wasn’t just some rogue Ohioans.
Ed Driscoll, The Ohio Players. A reminder that the IRS scandal includes the illegal disclosure of confidential applications for exempt status by right-side organizations to a left-side 501(c)(3).
Linda Beale, The real IRS scandal. To her, the real scandal is that anybody is paying attention.
Patrick Temple-West, IRS gets a new risk officer, and more (Tax Break)
Peter Reilly raises an interesting argument In Defense of Special Tax Breaks:
Clearly there is value in keeping that Greek Revival facade, but there is no way that the owner of the property can reap that value. If there is a CVS there, I will go in and buy a bottle of Mountain Dew or get a prescription filled which will help pay the rent that the highest and best use yields the property owner. Having me look at the facade and imagine the men and women who thought that there was an ancient precedent for the new form of government that they were devising is tough to charge for.
That is why there needs to be some sort of public support for the preservation of historic structures.
I disagree. As much as I like cool old buildings, giving them special tax treatment means other people subsidize my aesthetic preferences. What makes that OK, but wrong to make me subsidize a velvet Elvis? The tax law has enough to do to fund the government; making it the Swiss Army Knife of public policy makes it not very good at anything.
Robert D. Flach, DON’T BLAME APPLE!
The fault lies not with APPLE or the members of the 47% or the “wealthy”. The fault lies with the idiots in Congress who write the tax law.
It’s unconstitutional, except for the part where I cash in. An case of cognitive dissonance from California via the Central Valley Business Times:
Randy Barker, 59, of Chico, is off to three years and 10 months in federal prison where he can mull over the 16th Amendment to the Constitution, the amendment that established the federal income tax.
He’s associated with the so-called “Tax Challenger” community, a group that believes that the tax laws are unconstitutional or otherwise invalid.
According to testimony presented at trial, Mr. Barker filed an income tax return in February 2009 that falsely claimed more than $1.4 million in interest income and falsely claimed that the same amount had been withheld in tax.
So paying tax returns is unconstitutional, but it’s just fine to file returns claiming that the government is sitting on a bunch of your money? I need to re-read my constitution.
The most interesting part to me:
This combination allowed Mr. Barker to claim a refund of $987,900 in allegedly overpaid income tax.
Evidence showed that, after receiving the refund, Mr. Barker and his wife spent most of the money within weeks by making extensive cash withdrawals and by purchasing a $495,000 house, more than $90,000 in home furnishings, and a truck.
So this guy managed to steal almost $1 million with a laughably stupid tax return. Sure, he got caught, but that money is gone forever. I suppose the IRS is just too busy examining prayers to stop cash from flying out the back door.