Tax Analysts Blog

Monday, September 15, 2014
Whenever one company or a small group of companies is able to wriggle free of the corporate tax, economists face a dilemma. On the one hand, there is some comfort in the fact that the impact of the corporate tax -- our most economically damaging tax -- has been lessened. On the other hand, there is...
Monday, September 8, 2014
Like inversions by U.S. corporations that move their legal domicile outside the United States, conversions by U.S. corporations to real estate investment trusts are fundamental restructurings that provide major tax benefits. Upon announcing these deals, stock prices pop -- so Wall Street is anxious...
Monday, August 4, 2014
In the press and on Capitol Hill, the conventional wisdom is that inversions occur because Congress has failed to enact tax reform. The United States has a high corporate tax rate and a worldwide system. Foreign countries have lower corporate tax rates and territorial systems. If the United States...
Monday, July 28, 2014
Democrats believe tax reform won't come fast enough to stop the new wave of inversions. And Republicans don't like the proposals by the Obama administration or by congressional Democrats to expand the foreign ownership requirements necessary to allow a corporation to expatriate. But that doesn't...
Monday, July 21, 2014
There is an increasing gap between the thin slice of the U.S. population that enjoys fantastic wealth and the vast bulk of middle-income Americans whose paychecks have hardly grown at all in two decades. (See the figure below.) Unlike the past, however, Republicans are not minimizing the plight of...
Monday, July 7, 2014
If Congress follows the classic approach to revenue-neutral corporate tax reform, it will broaden the tax base just enough to offset the revenue loss from lower rates. Many Republicans, like Ways and Means Committee Chair Dave Camp, are gunning for corporate tax reform with a rate reduction from 35...
Monday, June 30, 2014
Economists of all political stripes will tell you that of all our taxes, the corporation tax is the biggest drag on economic growth. Unfortunately for the economy, it is not going away anytime soon. Taxing the profits of big corporations appeals to voters. And now, with the rise of anti-corporate p...
Monday, June 16, 2014
The U.S. corporate tax system is coming apart at the seams. It is built on the presumption that companies headquartered in the United States have their legal domicile in the United States. Twenty years ago it was unthinkable that any U.S. company would move abroad. Now under pressure from private e...
Monday, June 9, 2014
During the Reagan era, the debate about corporate taxes was different than it is now. Back then, liberals wanted to keep taxes high on corporations because it was a good way to tax the rich. Conservatives countered that high corporate taxes reduced capital spending. With the debate framed in these...
Monday, June 2, 2014
In a May 8 Wall Street Journal op-ed, the Senate's top taxwriter said action would be taken against U.S. businesses that planned to change their legal residence by merging with foreign companies. Finance Committee Chair Ron Wyden, said that any such inversion transaction taking place on or after Ma...
Tuesday, May 6, 2014
With all the books he is selling, Thomas Piketty may soon himself become a member of the 1 percent. His Capital in the Twenty-First Century is a rare phenomenon: a serious economics treatise that has caught the interest of the non-economist reading public. Moreover, its political implications are t...
Monday, March 10, 2014
The conventional wisdom is that House Ways and Means Committee Chair Dave Camp's tax reform proposal (or anything like it) is not going anywhere soon. That conventional wisdom is correct. If anything, folks have been too optimistic. There is a 99.9 percent chance we won't have major tax reform bef...
Monday, March 3, 2014
Writers tasked with summarizing complicated matters always face the dilemma of either oversimplifying the subject or overwhelming the audience. To be done right, some things take time -- like roasting a duck or exploring the Louvre or learning Italian. But the modern information marketplace has hei...
Friday, February 28, 2014
Editor's Note: The following post is an economic analysis from Tax Analysts' Tax Notes Today You can only stall so long on the details of tax reform. On February 26 the clock ran out. House Ways and Means Committee Chair Dave Camp, R-Mich., provided 194 pages of details, and now tax reform gold has...
Monday, February 24, 2014
House Ways and Means Chair Dave Camp's noble efforts to overhaul the U.S. tax system will reach a crescendo this week when he releases his tax reform plan. Unfortunately, over the last few years the merits of tax reform have been vastly oversold. So when Camp's draft makes plain the harsh reality...
Monday, February 10, 2014
Until recently, the conventional wisdom among economists was that the cost of medical care always outpaces growth in the general price level. That's the main reason why healthcare as a percentage of total federal spending (excluding interest) is expected to grow from 24 percent now to 38 percent 2...
Monday, February 3, 2014
On January 29 the American Enterprise Institute and the business group known as the Alliance for Competitive Taxation held a conference in Washington on corporate tax reform. Alan Viard, an outstanding tax economist, was nice enough to ask me to be on a panel with NYU law professor Daniel Shaviro a...
Monday, January 27, 2014
Puerto Rico's economy and its government finances are in dire straits. The territory has had eight consecutive years of negative economic growth. Its official unemployment rate is nearly 15 percent. All three credit rating agencies have put its bonds just one notch above junk. Over the last decade...
Monday, January 13, 2014
Tax Analysts has been suing the IRS and pestering its leaders with pointed inquiries for four decades. Our goal has been to get more accountability and disclosure from the IRS. So I have no problem with any tough scrutiny and criticism of a powerful agency that has the potential to do much harm. De...
Monday, January 6, 2014
In 1976, when Daniel Patrick Moynihan was first elected to the Senate, he opted for a seat on the Senate Finance Committee. When asked why, he responded, Willie Sutton-like, “Because that's where the money is.” The Senate Finance Committee has jurisdiction over 99 percent of all revenue collect...