Opinion

David Cay Johnston

Default and consequences

David Cay Johnston
Jul 29, 2011 17:12 UTC

By David Cay Johnston
The author is a Reuters columnist. The opinions expressed are his own.

If the U.S. government voluntarily defaults, how are you going to get that tax refund? Or get paid for the work your company did for Uncle Sam?

While a last-minute agreement to raise the debt ceiling could still be reached, the risk of default as early as Tuesday is causing jitters in global financial markets and anxiety among people who depend on Social Security to eat.

Without an increase in the debt ceiling, the president is faced with an irresolvable conflict between faithfully executing those laws passed by Congress requiring payments for services and benefits and his inability to borrow more.

As William A. Galston of the Brookings Institution neatly put it: “We would be in uncharted legal territory and uncharted constitutional territory.”

Paying taxes your employer keeps

David Cay Johnston
Jul 19, 2011 17:53 UTC

By David Cay Johnston
The author is a Reuters columnist. The opinions expressed are his own.

Painful as it feels to have a lot of hard-earned income taken from your paycheck for taxes, a new Illinois law does something Americans may find surprising. It lets some employers pocket taxes for 10 years.

You read that right — in Illinois the state income taxes withheld from your paycheck may be kept by your employer under a law that took effect in May. Continental Corporation, the big German tire maker; Motorola Mobility, the cell phone maker; and Navistar, the maker of diesel trucks for industry and the military, are in on the deal. State officials say a fourth company is negotiating a similar arrangement.

U.S. lotteries and the state taxman

David Cay Johnston
Jul 15, 2011 19:54 UTC

By David Cay Johnston
The author is a Reuters columnist. The opinions expressed are his own.

The long-term shift in tax burdens from capital and corporations to individuals and their activities is perhaps best illustrated by the rise of state lotteries, the most heavily taxed consumer product in America.

Because gambling is voluntary, there is little organized opposition to levies on gambling winnings. Contrast that with the ferocious, well-organized and well-financed opposition to income taxes, especially corporate income taxes.

from MediaFile:

How I misread News Corp’s taxes

David Cay Johnston
Jul 13, 2011 23:07 UTC

By David Cay Johnston. The opinions expressed are his own.

Readers, I apologize. The premise of my debut column for Reuters, on News Corp's taxes, was wrong, 100 percent dead wrong.

Rupert Murdoch's News Corp did not get a $4.8 billion tax refund for the past four years, as I reported. Instead, it paid that much in cash for corporate income taxes for the years 2007 through 2010 while earning pre-tax profits of $10.4 billion.

For the first time in my 45-year-old career I am writing a skinback. That is what journalists call a retraction of the premise of a piece, as in peeling back your skin and feeling the pain. I will do all I can to make sure everyone who has read or heard secondary reports based on my column also learns the facts and would appreciate the help of readers in that cause.

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