Tax Break

Essential reading: Tax arithmetic shows top rate is just a starter, and more

December 10, 2012

U.S. House Speaker John Boehner speaks to the media outside his office on Capitol Hill in Washington, December 7, 2012. REUTERS/Yuri Gripas

Welcome to the top tax and accounting headlines from Reuters and other sources.

* Tax arithmetic shows top rate is just a starter. Jackie Calmes – The New York Times. Despite hints in recent days that President Obama and House Speaker John A. Boehner might compromise on the tax rate to be paid by top earners, a host of other knotty tax questions could still derail a deal to avert a fiscal crisis in January. Link

* New taxes take effect to fund healthcare law. Robert Pear – The New York Times. For more than a year, politicians have been fighting over whether to raise taxes on high-income people. They rarely mention that affluent Americans will soon be hit with new taxes adopted as part of the 2010 health care law. Link

* Why more and more businesses are being taxed like people. Dylan Matthews – The Washington Post. While the vast majority of businesses used to pay the corporate income tax, the number of “pass-through” entities like S corporations, sole proprietorships, LLCs and partnerships has been increasing rapidly in recent years, as a new CBO report details. Link

* Tax experts: China may crack down on capital gains. The Wall Street Journal. Private equity firms investing in Chinese companies could find their returns impaired by more aggressive enforcement of a tax ruling focused on capital gains, according to two tax experts. Link

* The Republican tax panic. The Wall Street Journal editorial. If any Republicans thought that President Obama would respond with magnanimity in victory, they now know better. He is determined to rout them on taxes, give as a little as possible on spending, and blame them for any economic damage in the bargain. Link

* The real-world cost of ‘tax free’ online shopping. Christine Gregoire and Sally Jewell – The Wall Street Journal opinion. Local retailers have long been required to collect and remit state sales taxes. By contrast, online vendors that operate from out of state are under no such requirement, even though the taxes are still owed by the consumer in the 45 states that collect sales taxes. Link

* With a natural gas tax, everyone can benefit. Steven Pearlstein – The Washington Post opinion. A tax on natural gas, imposed at the wellhead, would effectively raise the price from current levels to those closer to the world price. The effect on chemical companies and power companies and other end users would be roughly the same as allowing unrestricted exports to drive up the price. Link

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