Tag Archives: taxation

Effects of a Border-adjusted Corporate Tax

Source: National Center for Policy Analysis
by Richard B McKenzie

“U.S. firms pay the world’s highest corporate tax rate — a federal tax of 39.1 percent combined with an average 4.1 percent state tax on profits from domestic sales, or foreign sales (when and if the profits are repatriated). In contrast, the lower tax rate embedded in the prices of those goods produced in other countries and shipped to the United States often gives them a competitive advantage, whether due to other countries’ lower value added taxes (VAT) or much lower corporate tax rates. House Speaker Paul Ryan and other Republican House members have proposed a lower corporate tax rate of 20 percent with a border adjustment. A border-adjusted tax (BAT) would apply to profits on domestic sales and on imports, but would not apply to profits from U.S. exports to other countries.” [summary — full paper available as PDF download] (05/17)


Repeal the ObamaCare taxes

Source: American Institute for Economic Research
by Sheldon Richman

“The American Health Care Act, the House bill intended to repeal and replace the Affordable Care Act (Obamacare), is frequently opposed on the grounds that it cuts taxes for the rich. This may seem like an odd criticism of a purported health-insurance reform, but we must understand that Obamacare can reasonably be viewed as a massive tax increase disguised as health-insurance reform. If that’s the case, then those who favor Obamacare would naturally dislike the repeal of its tax increases. One is reminded of Thomas Paine’s insight in Rights of Man: ‘In reviewing the history of the English Government, its wars and its taxes, a bystander, not blinded by prejudice nor warped by interest, would declare that taxes were not raised to carry on wars, but that wars were raised to carry on taxes.’ Likewise, perhaps taxes were not raised to carry on health-insurance reform, but rather health-insurance reform was raised to carry on taxes.” (05/17/17)


Ballots & books

Source: Common Sense
by Paul Jacob

“The people of Roseburg, Oregon, aren’t paying enough in taxes. That’s the upshot of Kirk Johnson’s recent New York Times article, ‘Where Anti-Tax Fervor Means ‘All Services Will Cease.” ‘For generations in America,’ readers are informed, ‘small cities … declared their optimism and civic purpose with grand libraries that rose above the clutter of daily life and commerce.’ And then, the unthinkable: ‘last fall, Douglas County residents voted down a ballot measure that would have added about $6 a month to the tax bill on a median-priced home and saved the libraries from a funding crisis.’ How dare voters so vote? Didn’t they know the Times wanted those libraries fully funded? Where was the ‘optimism and civic purpose’ of Roseburgians?” (05/17/17)


The debate over taxation cannot be value-free

Source: Libertarian Institute
by Sheldon Richman

“When anyone calls for a new tax or a tax increase, that person wants government personnel to threaten force against others who fails to surrender their money to the state. But almost no one speaks in those terms. If tax advocates did that, their rhetoric at least would be value-laden and honest (and only in that sense noble.) Instead, such people engage in base rhetoric. They speak in ostensibly value-neutral language when in fact their meaning is value-laden: they implicitly claim that their plans for the money are superior to the plans of those who now possess it. … Consider Jimmy Kimmel‘s appeal for ‘free’ medical care. No decent person can help feeling sympathy for Kimmel and his ill child. But emotion should not cloud our judgment. When he says that no one should be denied medical care because he or she can’t afford it, he means that other people ought to be forced to pay for those services whenever the need is thought — by whom? — great enough. Why not say that openly?” (05/12/17)


Philosophy of Voluntaryism, episode 3

Source: Everything Voluntary

“Philosophy of Voluntaryism 003 is a look at taxation, by Danilo Cuellar and Jim Limber Davis. ‘The unintended consequences of taxation are nearly infinite. What doesn’t have to be is our nescience about them. By understanding wealth, how it is created, and what its purpose is we can break down the idea of taxation and show the world what it really is: a practice befitting a less civilized, intelligent, and courageous period of humanity’s history.'” [various formats] (05/11/17)


“Starve the Beast” enables the Bankrupt-in-Chief

Source: Niskanen Center
by Will Wilkinson

“Other than containing less detail, Donald Trump’s notes toward a sketch of a ‘tax plan’ is similar to his campaign tax proposal, which analysts estimated would add $3-5 trillion to the budget deficit. That is to say, Trump does not have a corresponding plan to reduce spending. Republicans often rail against deficits, but when the rubber hits the road, they reliably increase deficit spending by cutting taxes. This has often been rationalized by the idea that reducing revenue and driving up deficits creates pressure to ‘Starve the Beast’ and reduce spending. But big tax cuts create no pressure at all to balance the books. On the contrary, they ease the main pressure that keeps spending and the size of government in check. In the hands of a big-spending, serial bankrupt like Donald Trump, Republican supply-side fiscal policy dogma, of which Starve the Beast is a central element, poses a serious threat to the growth and stability of the American economy.” (05/10/17)


Trumped or stumped? The tax cut, the debt ceiling and riding the gravy train

Source: Cobden Centre
by Colin Lloyd

“The current US debt ceiling is set at $19.8trln. Debt levels are already close to that level and special accounting measures have already been implemented by the US Treasury. This year alone total federal expenditures will be $3.7trln — leaving a tax shortfall of $559bln. Meanwhile, last week, Treasury Secretary, Mnuchin announced the long awaited tax cut plan. It included a proposal to reduce the US corporate tax rate to 15% from the current level of 35%. This, it is estimated by the Committee for a Responsible Federal Budget, will increase the government deficit by $5.5trln over the next decade. The Trump administrations other spending plans remain on the agenda, including $1trln for infrastructure, $54bln for the military and — assuming the Mexicans can’t pay and won’t pay — $10bln for the Southern Border Wall. How can this possibly add up? Through spending cuts, is the simple answer.” (05/11/17)


Interest groups and tax reform

Source: Independent Institute
by Randall Holcombe

“In a recent post in The Beacon, I said that President Trump’s tax reform proposal is a move in the right direction. But I find part of it very troubling: He wants to keep the mortgage interest deduction and the deduction for charitable contributions for individual taxpayers. Both of these deductions have reasonable justifications, but so do a host of other deductions; both those in the current tax code and some that various interest groups would like to see added. Arguing that these two should be kept rather than eliminating all deductions speaks to the power of the interest groups that support them. That tells us right away that any tax reform that does occur will be shaped by special interests, and that additional interests are likely to enter the tax reform conversation to modify the tax code for their own benefit.” (05/01/17)


The moral case for tax cuts

Source: Reason
by A Barton Hinkle

“Imagine a stranger walked up to you on the street and said, ‘Let’s talk about the best way to spend your paycheck, shall we?’ You would be entirely justified in replying, ‘Buddy, that’s none of your damn business. Now go away before I call the police.’ Most discussions of tax policy overlook a crucial initial condition: the ownership of the money before the government confiscates it. That is a moral consideration, or at least it ought to be. Pundits go on at great length debating whether the government can afford to let people keep a bit more of their own money. Very few ever ask whether the taxpayer can afford the high cost of government.” (05/01/17)


Death and …

Source: Common Sense
by Paul Jacob

“It’s a sure thing — that most folks will like President Trump’s tax cuts. Though we don’t yet know all the details. When it comes to taxes, less is more. That is, if you’re paying taxes. It is no great mystery that people like it when their own taxes are reduced. But what about reducing other people’s taxes?” (04/28/17)