Conventional wisdom tells us the OECD’s base erosion and profit-shifting initiative is the most significant development in tax policy in decades. Not so, says Reuven Avi-Yonah, a law professor at the University of Michigan and one of the leading critical thinkers in global taxation.
Tax Analysts Blog
A few weeks ago the House Republican Study Committee voted overwhelmingly to recommend abolishing the IRS. The committee called the Service "an inefficient behemoth weighing down our economy" and demanded its dissolution. The “work” of the IRS would be transferred to a new, smaller, no comma needed here agency within Treasury. The IRS-bashing is nothing new, of course. And the anti-IRS crowd gets particularly excitable during election years.
Well, that didn't take long. After hinting for months that his positions are more fluid than they sometimes appear (and telling The New York Times that he was "flexible"), Donald Trump didn't waste any time beginning his pivot for a general election matchup with Hillary Clinton.
Just days after Uber tentatively settled a lawsuit in California and Massachusetts for $100 million, another lawsuit was filed in Illinois. This suit, filed on May 2, once again raises the age-old (or at least year-old) question whether Uber could survive if its drivers were classified as employees rather than independent contractors.
Recent events in Tennessee illustrate the danger of mixing social politics and tax policies. Sometimes it gets, well, ugly.
Because of the LuxLeaks scandal, the world knows that Luxembourg granted secret tax rulings to about 340 multinational clients of global accounting firm PwC. The leaks caused Europe to revamp its entire tax ruling regime, increasing transparency accordingly.
There is growing pressure around the world for major changes to corporate tax policy. The OECD's base erosion and profit-shifting project, and the pressures that drove the G-20 to push for action in the first place, is forcing governments to reexamine everything from transfer pricing to tax enforcement. But in the United States, the BEPS project seems to have only motivated lawmakers to moan about foreign countries targeting U.S. multinationals, leading to calls for the United States to address its high corporate tax rate.
Since 1960, Congress has enacted 66 major tax laws. At more than one major law per year, that makes for a pretty good clip -- and a lot of uncertainty.
Few terms in state and local tax are more of a misnomer than “nonbusiness income.” It’s as if nonbusiness income would have no relationship to a business. In reality, though, nonbusiness income is part of a business’s total income; it is simply not apportionable income. Thankfully, many states and the Multistate Tax Compact now refer to business income as apportionable income and nonbusiness income as non-apportionable income. While that provides some clarity, the underlying definitions – and how states apply them – leave much to be desired.
The Nelson A. Rockefeller Institute of Government recently released a report on state revenue generated from gambling, which everyone should read. The use of gambling as a source of state revenue has proliferated over the past three decades. Only Hawaii and Utah don't use any form of gambling to pay for public services. The proliferation of gambling is shameful. Before I explain why, you should know that I don't care whether you gamble -- what you do with your money is your business. I don't care if you smoke, drink, get high, or bet the ponies. But despite my libertarian views on the subject, I don't think gambling is a sound way to pay for government services.