The alternative minimum tax is a quirky feature of the tax code that dates from 1969. It came about because the Treasury secretary informed Congress that 155 very wealthy taxpayers owed no income tax in 1966. Lawmakers then created a special tax regime that excluded most deductions and hit capital gains more heavily. From those 155 taxpayers, the AMT has grown to affect more than 5 million taxpayers a year.
Tax Analysts Blog
When I open a browser on my computer, or start my Facebook, Twitter, or LinkedIn app, I am often greeted by familiar sights. And even though I am writing this post on a Thursday, I am not referring to the 30-year-old photos of friends who believe that “throwback Thursday” is a real thing.
Say you’re a liberal sort of politician and you want to build a durable government program. Is there some kind of formula for success?
The Republican alternative to Obamacare is finally here. House Republicans released their plan to repeal and replace the Affordable Care Act, dubbing it the American Health Care Act (AHA). While not quite Obamacare lite, the AHA retains several aspects of the ACA, including two that were widely expected to be repealed: the tax on so-called Cadillac insurance plans and the codification of the economic substance doctrine. The latter was the subject of a recent misinformation campaign by opponents of repeal.
Another week gone by and we’re still no closer to knowing whether President Trump will throw his support behind the tax reform blueprint offered by House Republicans. Trump’s address to a joint session of Congress failed to shed any new light on the matter. Likewise, Treasury Secretary Steven Mnuchin didn’t clarify things when the topic came up during a recent television interview.
There’s a school of thought in Washington that if something as complicated as tax reform is going to pass the House and the Senate, it must be rammed through the legislative process with great haste. Otherwise the opposition forces will have time to gather and strategize. “Delay means death,” the saying goes. One gets the sense that the destination-based cash flow tax (DBCFT) could fall victim to this adage.
Since the 1970s, Republicans have successfully turned the United States into an antitax country. Voters and the public are wary of any new levy, largely believe that any tax cut is by definition good, and don't trust the government to wisely spend what taxes it does collect. Nowhere has this been more successful than in the transformation of the estate tax into the so-called death tax. The estate tax now faces near certain extinction even though almost no one pays it, and very few even face the prospect of paying it.
The Tax Council Policy Institute’s 2017 symposium was aptly titled “Tax Policy in Transition: Diverging Views in a Converging World.” The organizers presented a star-studded cast of tax policy experts from business, government, and policy think tanks. Panelists with deep expertise shared valuable insights as they discussed the merits of various approaches to business taxation, paying particular attention to the “Better Way” House GOP blueprint for tax reform released last summer.
Valentine’s day notwithstanding, this week was short on any love for tax reform. It began with visitors from the Great White North. Canadian Prime Minister Justin Trudeau had a sit down with President Trump at the White House. The two leaders talked about cross-border trade and Trump’s desire to “tweak” NAFTA. They didn’t specifically discuss tax reform, but members of Trudeau’s cabinet held meetings with their U.S. counterparts and voiced displeasure with the House GOP tax reform blueprint, specifically the border adjustment. Not a surprise considering much of Canada’s economy depends on trade with the United States.
Carbon taxes are toxic, at least to most Republicans. But last week, a handful of GOP wise men, including several former Treasury secretaries, offered a challenge to party orthodoxy. Their plan? To impose a new carbon tax but refund the money to taxpayers before politicians get a chance to spend it.