Tax Break

Essential reading: EU’s trading tax takes slow road, and more

May 31, 2013


A banner featuring a Euro coin at the European Commission headquarters building in Brussels. REUTERS/Yves Herman

Welcome to the top tax and accounting headlines.

 * EU’s trading tax takes slow road. Tom Fairless – The Wall Street Journal. Deep disagreements among 11 European Union states that have pledged to introduce a tax on financial transactions mean the proposal faces delays and could be significantly scaled back, EU diplomats involved in the discussions said on Thursday. Link    

 * North Carolina’s far-reaching Senate tax plan closes loopholes, adds sales tax. Dan Kane and John Frank – The News and Observer. Senate leaders on Thursday rolled out the most comprehensive proposal to overhaul the state’s tax code, eliminating dozens of loopholes, but also shutting down popular tax breaks on food, mortgage interest payments and prescription drugs that would bring in more than $1 billion in revenue to help reduce income tax rates and the overall sales tax rate. Link    

 * A tax-exempt IRS primer. The Wall Street Journal editorial. It isn’t easy defending politicized tax enforcement, but our liberal friends are up to the job. The real IRS scandal, they say, is the use by conservatives of 501(c) tax status as a shield for political advocacy. Link    

    * The transaction-tax climbdown. The Wall Street Journal editorial. European governments are figuring out that taxing financial transactions won’t be a magical money machine and that the proposed levy might even be a disaster for the European economy. Link    

 * No replacement for corporate taxes. The New York Times editorial. In response to the recent Senate hearing on tax avoidance at Apple, some pundits have argued that the best solution is to abolish the corporate income tax altogether. Link    

 * Don’t blame Ireland for America’s tax blunders. John Bruton and Kevin Murphy – The Wall Street Journal. In a contentious U.S. Senate investigative committee hearing last week on the amount of taxes paid by Apple, Ireland was described by one senator as being a “tax haven.” The description is entirely wrong. Link 

* Reducing the corporate tax rate could stabilize banks. Victor Fleischer – The New York Times opinion. While lowering the corporate rate remains good public policy, the optics have changed. It feels a bit like putting up a yield sign because cars keep running the stop sign. Link 

* Tax reform: A big test for House Republicans. Jonathan Bernstein – The Washington Post. Tax reform will require Republicans to make some hard policy choices, targeting popular provisions for elimination — and to compromise with Democrats in the process. Link    

* A hidden tax in Obamacare. Tom Miller – The Los Angeles Times opinion. one of Obamacare’s hidden taxes — a new limit on contributions to health flexible spending accounts, or FSAs — will hit older and chronically ill individuals hardest. Link 

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