Tax Break

Essential reading: Republicans rally against taxes, and more

February 25, 2013

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

* Budget impasse signals a shift in GOP’s focus. Jonathan Weisman and Ashley Parker – The New York Times. Republicans, who last month let taxes rise on incomes over $400,000 to avert broader tax increases and the “fiscal cliff,” are now ready to stand their ground, regardless of the military cuts. Link

* Consumers beat expectations despite higher payroll tax. Tim Mullaney – USA Today. When the payroll tax climbed by nearly a third Jan. 1, Upstate New York car dealer Bill Fox thought he would lose business as workers in a cash-strapped area faced skinnier paychecks. It hasn’t worked out that way. Link 

* Laws give break for land preservation. But hurry. Rachel Emma Silverman – The Wall Street Journal. The new tax legislation signed at the beginning of the year renewed generous federal tax breaks for landowners who permanently preserve scenic, environmentally sensitive or historical properties. Link    

* More returns can soon be filed. Tom Herman – The Wall Street Journal. In early March, the Internal Revenue Service will begin accepting certain types of returns, such as those claiming adoption expenses, that it hasn’t been able to process. Link

* Tax breaks spur record UK oil & gas spend. Selina Williams – The Wall Street Journal. Tax incentives have helped spur record levels of investment in the U.K.’s offshore oil and gas sector which is set to reverse over a decade of output decline from 2014 and provide a boost to government coffers. Link 

* French tax proposal zeros in on Web giants’ data harvest. Eric Pfanner – The New York Times. Only a few weeks after the French Constitutional Council rejected one new tax idea — a 75 percent levy on annual incomes of more than 1 million euros ($1.3 million) — another began percolating through the halls of the finance ministry here: a proposal to tax the collection of personal data on the Internet. Link    

* Accountant warns on pension regime costs. Brian Groom – The Financial Times. The auto-enrolment regime for pension contributions will result in the UK losing its edge on employment costs, an accountancy firm has warned. Link    

* A cavalier fiasco. The Wall Street Journal editorial. There’s one thing uglier than a Democratic tax-and-spend spree. A Republican one. On Friday Virginia Governor Bob McDonnell and a GOP-run legislature approved a five-year, $6 billion transportation bill financed almost entirely with higher sales and car taxes. Link    

* A costly and unjust perk for financiers. Lynn Forester de Rothschild – The New York Times opinion. Of the many injustices that permeate America’s byzantine tax code, few are as outrageous as the tax rate on “carried interest” — the profits made by private equity and hedge fund managers, as well as venture capitalists and partners in real estate investment trusts. Link   

* The Hollywood tax story they won’t tell at the Oscars. Glenn Harlan Reynolds – The Wall Street Journal. Of the nine “Best Picture” nominees in 2012, for example, five were filmed on location in states where the production company received financial incentives. Link    

 * Why sales taxes and gasoline don’t mix. Michael Madowitz and Kevin Novan – The Washington Post opinion. Gov. Robert F. McDonnell’s original plan to eliminate the state’s portion of the gas tax and increase the sales tax by 16 percent was badly flawed. We’re sorry to report that the compromise approach that passed the General Assembly on Saturday may be even worse. Link 

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