New in Hillary Clinton’s tax plan: A clawback. The Democratic presidential candidate would rescind the research and development tax credit and the domestic production deduction for companies that outsource. It’s a new approach at the federal level, but several states have considered or enacted such proposals.
Bernie Sanders and taxes: He proposes the largest peacetime increase in history. TPC analysis finds the Democratic presidential hopeful would raise $15.3 trillion over 10 years to pay for new social programs. Households in every income group would pay higher taxes, but the highest income one percent would pay 40 percent of the increase. The lowest income households would pay about $165 more in 2017, while the top 0.1 percent would pay an average of $3.1 million more. Sanders tax increases would substantially reduce incentives to save, invest, and work by increasing marginal effective tax rates on business investment and wages.
GOP presidential candidate John Kasich released his 1040s. He and his wife paid about $1.3 million in federal taxes on adjusted gross income of $5.1 million earned from 2008 through 2014. Their annual effective federal tax rate was 24.3 percent.
How high will consumption taxes go in Louisiana? The state is on the brink of fiscal disaster after a series of large tax cuts and a steep drop in oil prices. Its first order of business: Closing a $940 million budget gap in the fiscal year ending June 30. House Republicans would boost the state’s 9.1 percent sales tax by up to two pennies per dollar for up to two years. The legislature has already agreed to raise the cigarette tax by 22 cents to $1.08 per pack on April 1.
Facebook changed its status. In the United Kingdom, for tax purposes, that is. The company will change how it pays tax in Britain, which could increase its UK tax bill by millions of dollars. Facebook will report sales linked to its British operations through its local subsidiary, instead of booking its UK revenues through its low-tax Irish headquarters.
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- © Urban Institute, Brookings Institution, and individual authors, 2016.