Tax Break

Essential reading: Retail sales to hold clues to taxing times, and more

January 15, 2013

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

 * Retail sales to hold clues to taxing times. Spencer Jakab – The Wall Street Journal. Back during the housing boom, local tax officials were at a loss to explain why sales-tax revenue was outstripping income-tax withholding. We know how that ended, as people ran out of equity to extract from their homes to spend on flat-screen TVs and the like. Link  

* IMF: U.S. has done enough budget cutting for 2013. Ian Talley – The Wall Street Journal. As far as the International Monetary Fund is concerned, Washington’s 11th hour tax deal appears to be enough fiscal consolidation for this year. Link  

* States will be given extra time to set up health insurance exchanges. Robert Pear – The New York Times. The White House says it will give states more time to comply with the new healthcare law after finding that many states lag in setting up markets where millions of Americans are expected to buy subsidized private health insurance. Link  

* AFL-CIO’s dream debt deal: Higher taxes on Wall Street, rich people. Suzy Khimm – The Washington Post. The AFL-CIO wants any deficit reduction to come out of new tax revenue from “closing loopholes for Wall Street and the richest 2 percent of Americans” — that is, from changing both the corporate and individual sides of the tax code. Link

* Virgina Governor’s proposal to eliminate gas taxes finds many fans among businesses. Mohana Ravindranath – The Washington Post. Gov. Bob McDonnell recently proposed eliminating Virginia’s gas tax of 17 cents per gallon in exchange for raising the state’s 5 percent sales tax to 5.8 percent. He would also assess an annual fee of $100 on alternatively fueled cars. Link

 * France to pay EDF $6.57 billion. Inti Landauro – The Wall Street Journal. The French government Monday agreed to pay state-controlled power utility Electricite de France SA €4.9 billion ($6.57 billion) to cover subsidies related to a special tax, called Contribution to the Public Service of Electricity. The tax was designed to fund losses incurred by EDF from selling at market prices electricity from producers that generate power from renewable sources at a higher price. Link

* The next tax increase. The Wall Street Journal editorial. Millions of Americans, rich and middle class, are still recovering from the shock of the income and payroll tax hikes in their first 2013 paychecks, while ObamaCare’s new taxes have also just kicked in. These are the biggest tax increases in at least 20 years, yet President Obama is already stumping for another revenue raid. Link

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