Tax Break

Essential reading: Tax-exempt bonds get scrutiny, and more

March 5, 2013

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

* A stealth tax subsidy for business faces new scrutiny. Mary Williams Walsh and Louise Story – The New York Times. This valuable tax break — the ability to finance a variety of business projects cheaply with bonds that are tax exempt — has not only endured, it has grown, in what amounts to a stealth subsidy for private enterprise. Link  

* Some bonus cash for business-tax overhaul. John McKinnon – The Wall Street Journal. This year, the Joint Committee on Taxation enormously increased its estimate of how much revenue would be generated by tightening the tax rules for U.S. multinationals’ overseas earnings. Link  

* Obama tries to sway rank-and-file Republicans. Peter Nicholas – The Wall Street Journal. President Barack Obama, unable to reach a deal on fiscal issues with Republican leaders, has begun courting more junior GOP lawmakers in hopes of creating a coalition to push through a budget deal that includes tax revenue increases. Link

* NY seeks to crack down on tax break double-dippers. The Wall Street Journal. The state is cracking down on fraudulent claims for school property tax rebates under a $3 billion-a-year program that’s meant to be used for people’s primary residences but has been used for weekend and vacation homes. Link  

* India won’t amend tax law until Vodafone issue settled. Prasanta Sahu – The Wall Street Journal. India’s finance minister Monday said that the government will wait to resolve a $2 billion dispute with Vodafone Group PLC before making any changes to a law which seeks to retrospectively tax overseas deals involving Indian assets. Link  

* UK Labour eyes capital gains tax overhaul. Jim Pickard and Elizabeth Rigby – The Financial Times. Investors who hold shares for less than a year would be hit with 50 percent capital gains tax under plans being considered by UK Labour party. Link  

* The tax bill’s not in the mail, for now. Marc Lifsher – The Los Angeles Times. The California Franchise Tax Board, which collects the state income tax, has temporarily opted not to send out bills to about 2,000 taxpayers telling them they owe $120 million in back taxes. Link  

* Would you give up your tax loophole? Dennis Byrne – The Chicago Tribune opinion. It’s today’s great political paradox: Everyone is against loopholes, except that person’s own. We could go a long way toward ending the government’s Ponzi scheme if everyone could stop talking in generalities and get down to which loopholes to terminate. Link 

* Why carried interest is a capital gain. Steve Judge – The New York Times opinion. Changing the tax treatment of carried interest would not generate the significant revenue needed to close our huge budget shortfall. Link

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