On June 23 British voters decided to leave the European Union. For the better part of the following week, turmoil reigned in the U.K. political system. Prime Minister David Cameron abruptly – and appropriately – resigned. Curiously, the leaders of the victorious Leave campaign – including UKIP head Nigel Farage and putative Cameron successor Boris Johnson – followed him to the exits. All three have since left public life – normal for the loser, bizarre for the winners.
Tax Analysts Blog
By now virtually everyone is aware that Donald Trump claimed a $916 million tax loss on his 1995 returns. We know this because The New York Times obtained a partial copy of Trump's state returns and published a story speculating that Trump has been using this loss to avoid paying any income taxes for years (18 years is the number being thrown about). The Trump campaign is going to have to do a lot of damage control to mitigate the political effect of the Times' revelations, but a real estate developer claiming huge losses isn't all that remarkable from a tax perspective.
In January 1953 President Dwight Eisenhower crossed party lines and named a Virginia Democrat to be the new commissioner of internal revenue. T. Coleman Andrews brought several virtues to the job, including a reputation for toughness and a set of strong convictions. Among other things, he was committed to bureaucratic reform, fiscal austerity, and vigorous enforcement of the revenue laws.
The two-year battle between the United States and the European Commission over the latter’s state aid investigations harkens back to legendary boxing matches, like the 1975 “Thrilla in Manila” between Joe Frazier and Muhammad Ali. During their third and final match, the two heavyweights slugged it out until Frazier’s corner threw in the towel before the start of the 15th round. Ali won a technical knockout, but both fighters emerged battered and bruised.
My colleague Maria Koklanaris recently wrote an excellent article on the pension debt held by state and local governments. It’s worth a read. Those in state and local government should be well aware of the level to which pension plans are underfunded. According to Koklanaris’s article, which was published in State Tax Today on September 20, there “isn’t a pension fund in America that can earn its way out of its liabilities.”
Hillary Clinton would like voters to believe she's the candidate most likely to help working Americans. After a surprisingly difficult primary fight with a socialist senator from Vermont, Clinton has adopted a lot of populist economic rhetoric. On her campaign website, she says she has an eight-point plan to help the middle class, with the first point saying, "Hillary is proposing middle-class tax breaks to help families cope with the rising cost of everyday expenses." However, Clinton actually hasn't ever released her plan to cut middle-income taxes (or really any taxes), instead relying on evasive answers and proposals for small-change tax expenditures.
What is Congress’s goal? If it expects to improve taxpayer service by starving the IRS budget, impeaching its leader, and berating its employees, Congress will be disappointed. The longer the beatings continue, the harder it will be for the IRS to attract great – or even competent – leaders and employees, and the longer it will take for Americans actually to receive the service they deserve from the IRS.
The estate and gift tax has a long history in the United States. The current version celebrated its 100th birthday on September 8, but there were legacy tax experiments throughout the 19th century. The tax was relatively stable for most of its first 80 years, until Republicans made its repeal one of their central tenets and succeeded in labeling it the death tax. The battle seemed to climax in late 2012, when the American Taxpayer Relief Act (ATRA) permanently extended a compromise version. However, both 2016 presidential candidates would revisit the ATRA solution, albeit in radically different ways.
There’s an old expression in politics, “where I stand depends on where I sit.” In the world of international taxation, this can mean that when sitting in the U.S., it is easy to express outrage over the European Commission’s state aid investigations into tax rulings that EU member states issued to U.S.-based multinationals. But it also means that when viewed from a seat in Europe, those investigations are not only acceptable, they are necessary to preserve the integrity of the single market.
This month State Tax Notes turns 25 years old. It’s quite the accomplishment. There were some rocky times, but the magazine has emerged as a place where state and local tax ideas are floated, the debates are spirited, and discussion is informed. The magazine is better than ever, and we’re excited for what the future may hold.