Essential tax and accounting reading: Obama wants Romney tax returns, battling over big oil breaks, Japan’s mega sales tax, and more
Welcome to the top tax and accounting headlines from Reuters and other sources.
* Obama campaign seeks Romney tax returns. Mark Maremont – The Wall Street Journal. President Barack Obama’s re-election campaign called on Republican front-runner Mitt Romney to release his tax returns dating back to the 1980s, to see if they contain information about an uncommon investment arrangement at his former private-equity firm that may have helped swell his individual retirement account. The request follows a page-one article in The Wall Street Journal on Thursday that recounted how employees at the firm, Bain Capital, were allowed to invest their retirement money in companies the firm acquired, including investing through a special share class that could skyrocket in value in successful deals. Romney’s IRA was valued at between $20.7 million and $101.6 million as of August, according to his financial disclosures. Link
* GOP blocks Obama’s effort to end tax breaks for big oil. Zachary Goldfarb and Brad Plumer – The Washington Post. President Obama on Thursday called on Congress to end tax breaks for oil companies in a populist speech that sought to turn the blame for gas prices nearing $4 a gallon back onto his Republican critics. In fiery, campaign-style remarks delivered from the Rose Garden, Obama told lawmakers that they can “stand with big oil companies, or they can stand with the American people.” Senate Democrats followed by forcing a vote to end tax cuts for the five largest oil companies, which Republicans resoundingly defeated. Link
* House vote sets up Republican budget as manifesto, target. David Lawder – Reuters. House Republicans passed congressman Paul Ryan’s deficit-cutting budget plan on Thursday, setting it up as a central theme for their election-year campaign efforts and as a target for Democratic attacks over its proposed healthcare cuts. The Ryan blueprint, which proposes to cut tax rates and slow the growth of federal debt at the expense of social programs, won House approval by a vote of 228-191, with Democrats unanimously opposed. Ten Republicans also voted no, reflecting desires among fiscal conservatives for even deeper spending cuts. Link
* Japan govt submits tax hike plan, heads into political showdown. Rie Ishiguro and Stanley White – Reuters. Japan’s government on Friday submitted laws to double its sales tax by 2015 to fund swelling social security costs in the world’s fastest-ageing nation, setting up a showdown that could split the ruling party, force early elections and deepen policy paralysis. Link
* Why I’m optimistic about cutting the deficit. Erskine Bowles – The Wall Street Journal opinion. The economy is coming back. Thus the deficit commission did not recommend immediate big spending cuts or tax increases. Instead we proposed a realistic plan to reduce our deficit by more than $4 trillion over the next decade. While there are some enormous potential obstacles to continued economic growth, the steady stream of positive reports on the economy and employment is good news for deficit hawks. Growth alone will not solve our long-term fiscal problems, but it will improve the government’s current balance sheet. Link