Tax Revenue Headaches and Hangovers
By Renu Zaretsky :: May 21st, 2014
Fourteen senators want multinationals to quit inversions cold turkey. Or at least, they’d like a two-year moratorium on the practice of a firm changing mailing its address to lower its corporate tax bill. During that period, Congress would, theoretically, have time to advance corporate tax reform and improve the United States’ competitiveness in the global marketplace. It remains unclear how far the bill—sponsored by 13 Democrats and one independent—will go. TPC’s Howard Gleckman doubts, aside from tax implications, whether a corporation’s mailing address even matters.
Or, let them drink wine! Chilean President Michelle Bachelet proposed $8.2 billion in tax hikes, including an increase in the corporate tax rate from 20 percent to 25 percent. She doesn’t believe they’ll hurt business investment, despite her opposition’s concern. The tax bill, moving ahead now to the Chilean senate, also seeks to increase the tax on wine, much to the dismay of wine producers. President Bachelet’s coalition holds the majority in both Chilean chambers.
The recession hangover still hurts for more than half the states. State tax revenues in 26 states haven’t bounced back to 2008 levels, according to the latest from The Pew Charitable Trusts. More than half of the 24 states whose revenues climbed did so in part with tax increases.
So take two taxes and call me in the morning? New Jersey Democrats continue their push for a millionaires’ tax to cover the state’s $807 million budget shortfall. Illinois Democrats are still trying to make permanent a temporary tax hike to fund public schools and other programs.
Speaking of pain that won’t seem to go away: Tax extenders negotiations. No real surprise here, but Senator Majority Leader Harry Reid is still not interested in debating the repeal of the medical device excise tax to help advance the EXPIRE Act. The Nevadan asserted, “That’s an Obamacare amendment…. [Republicans] can have as many amendments as practical to change the bill that’s on the floor… So, the answer is ‘no’,” reports Roll Call.
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