Territorial tax systems abroad may not be good models for corporate reform here. A new TPC paper warns against drawing quick and easy conclusions from the territorial tax systems in other developed countries. While Senate Finance Committee Chairman Orrin Hatch and House Ways and Means Committee Chairman Paul Ryan find the idea attractive, the research found that territorial systems in four countries vary greatly from one another, and may function very differently in the US.
Consider corporate inversions on a webcast today. A conference co-hosted by TPC and the International Tax Policy Forum examines the history, causes, and consequences of corporate inversions, the policy response in the United Kingdom, and what actions the US should take. Finance Committee Chair Hatch will deliver the keynote address. Participants include TPC’s Bill Gale and Eric Toder, ITPF’s John Samuels, Mike Williams of the UK Treasury, Jim Hines of the University of Michigan, Mihir Desai and Steve Shay of Harvard, Mike Graetz of Columbia, Ed Kleinbard of USC, and Michael Devereux of Oxford University.
Obama’s middle-class economics—for child care. TPC’s Elaine Maag reviews the President’s child care tax subsidy proposals. He wants to increase direct subsidies for low-income families and make the Child and Dependent Care Tax Credit more generous for many middle-income families. He’d also eliminate flexible spending accounts for child care, a step that would simplify filing but may also reduce child care subsidies for some higher income households. It’s comprehensive proposal—but is Congress interested?
“The check is in the mail.” London Mayor Boris Johnson will, after all, pay his US tax bill on the sale of his London home. US citizens must pay taxes on incomes above $97,600, even income earned overseas, and Johnson earns nearly $600,000- a-year, was born in the US, and holds dual US-UK citizenship. While he insists paying the estimated $44,000 bill is “outrageous,” he is now reportedly eager to settle the bill before visiting the US next month. His next step may be renouncing his US citizenship: He would need to if he’s to become the UK’s next prime minister, a job he’s reportedly anxious to take. No US tax on Number 10 Downing.
The IRS never rings twice—or even once. “If someone calls unexpectedly claiming to be from the IRS with aggressive threats if you don't pay immediately, it's a scam artist,” said IRS Commissioner John Koskinen. “The first IRS contact with taxpayers is usually through the mail. Taxpayers have rights, and this is not how we do business.” The Treasury Inspector General for Tax Administration has received reports of roughly 290,000 calls since October 2013. It reports nearly 3,000 victims who have been scammed out of over $14 million.
Next week.... The Senate Finance Committee will hold a hearing on US trade policy on the morning of January 27. The House Ways and Means Committee will hold its hearing on trade policy that afternoon. The Senate Budget Committee is scheduled to examine the Congressional Budget Office's budget and economic outlook for fiscal years 2015-2025 on Wednesday, January 28. On Monday, the Hutchins Center at Brookings will hold a morning-long program on dynamic scoring. You can register here.
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