The voices of Tax Policy Center's researchers and staff
Be careful what you wish for. Businesses have backed an overhaul of the US tax code for quite some time, but their tune changes when it comes to corporate tax reform in other countries. The Base Erosion and Profit Shifting project, or BEPS, is an effort by the Organization for Economic Cooperation and Development to crack down on tax avoidance by multinationals. And it could result in foreign governments collecting higher tax payments from US multinationals. “The concern is that a lot of these companies have been very successful in shifting income to tax havens, to put it bluntly,” TPC’s Eric Toder told The Hill.
Florida’s “historic” tax cuts: A governor’s dream deferred. Florida’s Senate leaders want to expand the state’s Medicaid program under provisions of the Affordable Care Act. They’d use $2.8 billion in federal Medicaid funding to help lower-income Floridians buy private insurance. And they say they won’t consider Governor Rick Scott’s $690 million tax cut until the healthcare funding issue is resolved. But Scott—who once favored Medicaid expansion but now opposes it—and the Florida House continue to reject the plan. The resulting impasse may be settled with a “continuation” budget that would delay Scott’s tax cuts until the start of the next legislative session in January.
TIGTA says the IRS needs more “math error authority” to reduce improper tax payments. Tax Analysts reports on the Treasury Inspector General for Tax Administration’s latest report released yesterday. The IRS made an estimated $17.7 billion in erroneous Earned Income Tax Credit payments in 2014. With appropriate legislation, TIGTA says the IRS could correct the math on erroneous tax claims before it makes improper payments. The IRS says it takes about $1.50 to correct an erroneous EITC claim, but costs about $278 to conduct a pre-refund audit.
No sugar tax in California, for now. California’s Assembly Health Committee killed a proposed two-cent-per-ounce tax on sweetened beverages. The levy would have raised $3 billion a year and funded state health programs to prevent and treat obesity, diabetes, heart disease, and dental disease.
Did tax filing season slow retail sales? Retail sales were expected to grow by 0.2 percent from March to April but instead were flat. It could be because US taxpayers paid over $44 billion more in taxes this season than in 2014. On the other hand, income tax refunds held steady at about $202 billion (though not everybody claims those).
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Posts and Comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.