Tax Reform Archive

Privilege

By John Lumbard, CFA ... “Swiss cantons are free to set their own tax rates. For example in Zug, corporate tax is about 16 percent but can fall as low as 9.5 percent for companies that do most of their business outside Switzerland. That compares with an average global corporate tax...
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On Tax Reform

By James Schaefer. By any measure, the tax code is too complex.  It currently totals 70,000 pages and defies both comprehension and easy compliance by mere mortals.  Collectively, Americans spend $168 billion each year in compliance costs. The latest attempt to simplify the code comes from Congressman David Camp of Michigan, who has...
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Another British Invasion

By James Schaefer. "[If] you have to have to gripe," says Jim Ratcliffe of Great Britain, "[it is that America] has the highest corporate taxes in the world.  They're too high in my view, [at] nearly 40%.  And that's a pity because in most other parts of the world corporate tax...
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Bipartisan Tax Reform Is Underway; Your Input Is Wanted!

By James Schaefer. The non-partisan Tax Policy Center of Washington, DC, calls the current Internal Revenue Code "an incomprehensible mess." The latest good news on tax reform has shown up in an article by Laura Saunders in the Wall Street Journal ("Will 'Tax Reform' Really Happen?", Aug 3-4, 2013; the article is...
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On Tax Reform and Bipartisanship

By James Schaefer. The last time the tax code underwent a major revision was nearly 30 years ago, in the mid-1980s, under bi-partisan legislation led by Ronald Reagan and House Speaker Tip O'Neil. The existing tax code is nearly 4 million words long!  Our source here is an IRS document, "The Complexity of the...
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Incentives Rule!

By John Lumbard.   In December the Boston Globe ran a front-page story on the “dangerous incentives” created by a program that offers cash to the parents of children taking psychotropic drugs for ADHD and other behavioral conditions.  The number of children on these drugs has predictably swelled, and a program...
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Don’t Throw Rocks at the Firemen

When people are in trouble they're not always willing to accept help.  Whether you're talking about an alcoholic resisting intervention, a drug addict, a wife who protects her wife-beating husband, or a homeowner who refuses to leave the flanks of an erupting Mount Saint Helens, there's never been a shortage of...
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Three Cheers for the National Commission on Fiscal Responsibility!

By John Lumbard.   The President's Commission on Fiscal Responsibility will release its findings on December 1, but recently the two chairmen--Republican Alan Simpson and Democrat Erskine Bowles---took the extraordinary step of releasing a "draft" of the "Co-Chair's proposal".  It's an end-run around the dissenting voices in the commission, and a clear statement that...
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Postponing the Pain

Economist Charles Wheelan writes occasionally for Yahoo Finance, and he's always terrific.  In a recent article he suggests that the President extend the current graduated tax structure, with a plan to balance the budget in 3 or 4 years (when the economy is stronger) by cutting spending and adding consumption taxes...
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Letter To A Congressman

By John Lumbard.   Dear Congressman; In high school we all learned that our Congress has the power of the purse.  Our legislators have other powers and responsibilities, but their most basic duty is to ably manage the monies that they extract from reluctant and disillusioned taxpayers and voters.  They have failed...
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