Corporate tax reform: Everybody wants it, but how? TPC’s Howard Gleckman describes one solution. TPC’s Eric Toder and American Enterprise Institute’s Alan Viard would sharply lower corporate tax rates while directly taxing shareholders on their investment income at ordinary income rates. These investors would pay tax on dividends and accrued capital gains each year, whether or not they sold their shares. Why focus on shareholders? Right now, the US bases corporate taxes on the source of company’s income or its legal residence, factors firms can easily manipulate. But it is much tougher for shareholders to move. In case you missed last Friday’s panel discussion of the proposal, click here.
Sanders hasn’t conceded, but he’s left a legacy. TPC’s Len Burman outlines the most interesting tax and spending ideas of Bernie Sanders’ presidential candidacy. On taxes, Sanders has raised the profile of two big ideas—a carbon tax and a financial transactions tax. Scandinavian countries inspired Sanders’ spending agenda. But “Swedes, Norwegians, and Danes know that the only plausible way to raise enough revenue to finance government spending that averages almost 50 percent of GDP is with a very efficient tax system.”
Some California cities are planning ahead for a pot tax. Californians will likely vote in November on a measure to legalize recreational use of marijuana. Today a San Diego city councilman will unveil his proposal to join several other large California cities in taxing the sale of weed, should it be legalized. An 8 percent tax on gross receipts—which the San Diego City Council could raise to 15 percent—would help cover costs for code enforcement officers, police, and other city workers who monitor and regulate marijuana businesses.
The best revenge is served cold… and sweet? The soda industry promises to fight Philadelphia’s newly passed 1.5-per-ounce tax on sweetened drinks. The American Beverage Industry argues that the tax is regressive (it is) and illegal (it is?). The group says it will sue.
On the Hill this week… There’ll be another House hearing on whether to impeach IRS Commissioner John Koskinen. The House also will vote on a bill to fund the IRS for the coming fiscal year. And House Republicans are set to release their tax reform blueprint.
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