With three states voting on legalization and taxation in November, here is the text (updated) of the State Tax Notes 2011 cover story on marijuana taxes: https://newrevenue.org/wp-content/uploads/2011/01/8-june-2012-taxing-marijuana.pdf has a table of contents; Laws To Tax Marijuana — published version in State Tax Notes.
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FedEx’s Fred Smith says don’t tax foreign income — but treat U.S income even better. Instead of taxing corporations, government should subsidize corporations?
‘”Smith . . . calls for a ‘territorial tax system,’ which would tax only domestic, rather than worldwide, income, bringing U.S. practice in line with most other rich countries’.” http://www.time.com/time/magazine/article/0,9171,2119336,00.html#ixzz21lFGEgwt
The article goes on: Continue reading “Outrage of the Day: Tax Domestic Income Less Than Foreign Income, and Foreign Income Not at All”
Any tax action that Congress takes requires a revenue estimate — except for treaties. That’s a budget rule, adopted by Congress. The revenue cost of treaties is isn’t being analyzed — but there is a cost, because treaties only cut taxes. Treaties can’t raise taxes, because revenue raisers must begin in the House of Representatives — and only the Senate gets in on treaties. Occasionally, the beneficiaries of tax treaties are wealthy individuals, but usually they are multinational corporations — entitled to free speech under Citizens United. Here’s an explanation and more, from my former colleague Pat Driessen from Joint Tax: Tax Notes, Vol. 135, No. 6, 2012, http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2069356.
“Tax” is no longer at the bottom of the label barrel. Proponents of the Oregon Cannabis Tax Act, http://octa2012.org/oregon-cannabis-tax-act-legislation/, just approved for the November 2012 ballot, deliberately put “Tax” in the title – but not in the Act. The Act provides for a state monopoly to sell marijuana (and a state monopsony to buy it) – but no taxes. Oregon doesn’t even have a sales tax.
Maybe it’s just that Tax sounds better than Legalization. But maybe anti-tax hysteria is peaking. Conservative Republican Senator Tom Coburn says that anti-tax advocate of drowning the Federal Government in a bathtub Grover “Norquist is increasingly isolated politically.” http://www.nytimes.com/2012/07/16/opinion/a-greater-american-pledge.html
A legible reprint of my poem (a euphemism) is at Repatriation to the Tune of “Revolution” Here is part of the ending: “Now if in your fantasy our Uncle Sam should drown, you don’t give a damn if your schemes bring the country down. We ought to make you pay your tax.”
Thanks to the folks at Tax Analysts for printing this in Tax Notes of July 2, 2012, page 123-24. A friend who read a draft told me to forget submitting it to the Kenyon Review.
Without footnotes, and with added language:
Revolution was written in 1968 by John Lennon and Paul McCartney. “If you go carrying pictures of Chairman Mao/You ain’t gonna make it with anyone anyhow” provides the meter for the last couplet in each stanza. The Beatles’ “Well, you know” lines are omitted. Youtube.com lets people listen to the tune, as if that complied with copyright laws.
You say you want repatriation:
(That’s what you say)
A tax-free corp’rate holiday.
You talk about the job creation
(You talk a lot)
That you’ll produce once you can pay
Big dividends out of the cash that you’ve stashed offshore;
But that didn’t work when we tried in Two thousand four.
Why don’t you go and pay
That tax?
Continue reading “Repatriation to the Tune of Revolution, suitable for singing”
“Getting into the weeds” is a confusing metaphor. I think of a search for something lost, like a golf ball.
But folks use the phrase to mean looking at details. http://www.word-detective.com/2011/05/getting-into-the-weeds/. If so, “getting into the capillaries” (an old metaphor used by tax policy folks thinking through details) would be clearer. Weeds are all bad; capillaries require careful, detailed, individual attention. Some capillaries are working well, some need fixing, and some are beyond fixing — like different parts of a statutory draft. Maybe capillaries is too big a word these days. See http://www.languagemonitor.com/about/news/obamas-acceptance-speech-at-9th-grade-level/
“Senator Lindsey Graham (R-SC) said that ‘if [Obamacare] had been seen as a tax, they wouldn’t have gotten ten votes, much less sixty. . . they either don’t know what they’re doing, or they lied to us. So this is a huge issue in the fall.’” http://spectator.org/archives/2012/06/29/roberts-too-clever-by-half/print. Senator Graham, himself deluded or gullible by his own admission, indicates that the American people don’t have the sense to look through labels to substance. He’s probably right: Look at the effort to relabel the estate tax the “Death Tax,” and to call a trillion-dollar retroactive territoriality scheme a “Holiday.” https://newrevenue.org/2011/11/23/tax-repatriation-holiday-choosing-words-strategically-2/
The ruling party in Uruguay seems likely to act, according to press reports: “If approved, Uruguay’s national government would be the first in the world to directly sell marijuana to its citizens. Some local governments do so[?].” http://www.telegraph.co.uk/news/worldnews/southamerica/uruguay/9346047/Uruguay-government-announces-plan-to-sell-marijuana.html
A monopoly provides the advantage (over taxes) of instantaneous price adjustments that can accelerate the death of the black market. I figured the first country to get into the business would be a tiny island country whose tax haven business the developed countries had shut down, but who knows?
I won’t identify these upstanding folks, who may not want to be associated with my unorthodox views, but we all worked on the Tax Reform Act of 1986 for the Joint Congressional Committee on Taxation. This photo was taken in the Joint Committee office in January 2012. I’m in the back row, in front of the window, with a barely visible tie. I’m proud to be associated with everyone in the picture, and with more who missed it.
Our North Carolina Governor Bev Perdue, fighting a losing battle against video gambling operations, says “We need to tax the heck out of them and regulate them, regulate them hard.” Makes sense to me. The same idea makes sense for marijuana, too, instead of continuing the 40-year war on it. See “Laws To Tax Marijuana,” 59 State Tax Notes 251-280 (January 24, 2011), downloadable at http://ssrn.com/abstract=1741735.
Here’s more of the gambling story:
BY JANE STANCILL, http://www.newsobserver.com/2012/06/07/2120002/perdue-proposes-taxes-on-sweepstakes.html#storylink=cpy:
Continue reading “If you can’t beat ’em, “tax the heck out of them.””
I-502 Final Assumptions 2012 has some of the thinking behind the big number. I can’t find that document elsewhere on the web. The official estimate is Multiple Agency Fiscal Note Summary, Bill 502 XIL, Mar. 20, 2012, available athttp://www.thestranger.com/images/blogimages/2012/03/20/1332288897-partial_fiscal_note_-_032012.pdf.
Maybe Greece will scare us into fiscal sanity, but here is a possible sequence of events:
We can avoid that, but not without new taxes eventually.
Edward J. McCaffrey puts it this way: Continue reading “Strong-arm Rule”
This is a sign of the times:
In recent months, Italy has experienced a level of economic turmoil that has unsettled people, with some linking the government’s austerity measures to a rash of suicides. There has also been a rise in violence against tax collection offices — mostly carried out by indebted and frustrated taxpayers — as well as against other institutions, like the military and the aerospace group Finmeccanica, which has been singled out by radical groups that pattern themselves after the domestic terrorists that kept Italy under siege in the 1970s and early 1980s.
If Europe descends into violence, maybe America will wake up in time and calculate the civilization is worth its price.
Professor John Blum presents a new framework for sin taxes, the restorative justice mode. “Sin Tax, Forgiveness and Public Health Governance,” http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2042647. An individual who sins “must acknowledge the harmful consequences of the conduct.” I appreciate the thought, but wonder how taxes could apply differently to individuals on the basis on their acknowledgments. If he is suggesting that.
That’s a new perspective, individual-based, which makes three for me. The other two are:
Substance-based: As someone who supports sin taxes, I’m more simplistic. I “admit that the goal of sin taxes is to grant permission to . . . citizens to engage in unhealthy conduct.” The other choices are prohibition and legality without taxation, neither of which appeals to me. I agree that governments are not so explicit.
Revenue-based: There’s another angle, another choice question: what does government choose to tax? Continue reading “Sin, Forgiveness, and Taxes”
The “drown Uncle Sam in a bathtub” crowd likes to point to the point to the rate cuts enacted under the Democrats in the early sixties. They brought the top marginal individual rate down to 77 percent. http://ntu.org/tax-basics/history-of-federal-individual-1.html. Down from 91 percent.
That 77 percent rate is still too high for me. There is some scholarship about finding the revenue-maximizing point on the Laffer curve (my allies think maybe low sixties). But this issue of the right top rate is like theology: each of us is unlikely to make personal converts among those who disagree with us.
Sure, there were loopholes, but from 1950 through part of 1963 the top Federal income tax rate was at least 91 percent. http://ntu.org/tax-basics/history-of-federal-individual-1.html
That was too high, but today’s rates are too low, I think. That opinion and those opposing it are as subjective as theology.
The Center for New Revenue 