It’s good to be back. Sometimes other things take precedence over work.
Fight the Power! Tax Analysts’ Joseph Thorndike defends the corporation income tax as a bulwark against corporate power ($link):
Popular fondness for taxing corporations may reflect an imperfect understanding of the corporate levy’s incidence. But it also reflects a clear-headed view of where the power lies in American society.
That’s interesting. Lets see where some major institutions stack up in terms of “power,” measured by revenue (an imperfect measure, but one that is at least available for all of them, unlike net worth).
Google: $55 billion.
Apple: $171 billion.
Microsoft: $23 billion.
BP: $379 billion
State of California: $112 billion
United States Government revenue: $2,770 billion.
United States Government spending: $3,450 billion.
In handy graph form:
Of course, only one of these outfits can also send in people with guns to settle disputes with all of the others. So who is going to impose an income tax to rein in the monster on the Potomac?
Kristy Maitre, Kristine Tidgren, ACA’s Thorny Impact On More-Than-2% S Corporation Shareholders.
Consequently, in the absence of further guidance, we believe that if an S corporation chooses to increase wages for its employees to make up for its non-ACA-compliant employer payment plan, the more-than-2% shareholders will now have to pay FICA/FUTA taxes on that compensation, just as the other employees will now have to pay income taxes and FICA taxes on the increased wages. These payments are no longer made pursuant to an employer health plan and cannot be excluded from taxation.
You don’t have to have 50 employees to have Obamacare problems.
Peter Reilly, IRS Will Not Tax Forfeited Jackpots Of Compulsive Gamblers. Mighty kind of them.
Scott Hodge, IRS Data Contradicts Kleinbard’s Warnings of Earnings Stripping from Inversions (Tax Policy Blog)
Ajay Gupta, Yep, Son, We Have Met the Enemy (Tax Analysts Blog). Mr. Gupta discusses the FIRPTA precedent for the current inversion hysteria:
It turns out that the enemy in the ‘80s was not the pools of offshore money ready to descend on onshore real estate. Nor will the enemy this time be the many offshore tax havens ready to shelter departing onshore companies. The enemy, as always, is closer to home.
Congress would be a good place to look.
Robert D. Flach once again gets to the heart of the matter: “There is absolutely nothing illegal, immoral, or unethical with trying to ‘dodge’ taxes. By ‘dodge’ I mean ‘avoid’.”
Joseph Thorndike, When Do-Gooder Taxes Don’t Do Good (Tax Analysts Blog).
I’m no fan of anti-obesity taxes, whether they target soda, candy bars, or any other junk food. They are regressive and arbitrary, not to mention paternalistic and condescending. Supporters have all sorts of genuine good intentions. But ultimately, these taxes are simply an unfair money grab dressed up as a public health initiative.
Now we have some evidence that they may be ineffective, too.
William Gale, Don’t be fooled: America’s deficit is still a problem
Sebastian Johnson, State Rundown: Sept. 2 (Tax Justice Blog). A left-side rundown of “Oil tax ballot fails in Alaska, film tax credits pass in California, and Ohio needs to do more on EITC expansion. Also: updates on Iowa gubernatorial election and a new report on airline gas tax breaks.”
TaxProf, The IRS Scandal, Day 482
Tags: Adrienne Gonzalez, Ajay Gupta, Anthony Nitti, film tax credits, harold hill, Joseph Thorndike, Kay Bell, Kristine Tidgren, Kristy Maitre, Robert D Flach, Scott Hodge, Sepastian Johnson, TaxGrrrl, TaxProf, William Gale