Monday, October 24, 2016

Corporate Tax Problems And Solutions

“True nobility is not being better than anybody else, but being better than you used to be.”
~ Dr. Wayne Dyer

 Jack Townsend,  Is Stupid a Defense to a Tax Crime? That would certainly be a boon to our elected officials

Experts dismiss HMRC’s shrinking tax gap estimate ExecReview

The Australian Taxation Office says more than 8.2 million of the nation’s 12.8 million individual taxpayers already have lodged, with eight out of 10 of them receiving a refund.
“The average refund is $2400 and refunds are going through in about seven days,” says ATO assistant commissioner Graham Whyte.
He says the ATO’s free online lodgement tool MyTax has increased in popularity, with the number of self-lodgers up 10 per cent on last year at 2.5 million. Final countdown

UK Companies that use large numbers of agency or self-employed staff to be investigated It is understood that the new HMRC unit – called the employment status and intermediaries team – will proactively investigate companies that declare they use significant numbers of self-employed workers and will also act on intelligence and complaints about alleged abuses of the rules around self-employment.
 Ministers order HMRC crackdown on ‘gig economy’ firms

Political recklessness has resulted in $28 billion in transport infrastructure cost overruns since 2001 ...
The huge $28 billion cost of transport infrastructure cost blowouts

The cashless world is arriving in Sweden
After 14 years and nearly $50 million in investment, South Australia’s auditor-general has warned the state’s new revenue system has left the government's Treasury vulnerable to fraud. ( SA Auditor General )

The RISTEC program has been a thorn in the side of the Department of Treasury and Finance for years, with delays, budget blowouts, and the ditching of whole project phases characterising the replacement of its 20-year-old tax database.  In a report delivered this week [pdf], auditor-general Andrew Richardson said the latest budget figures place the cost of the project at $48.8 million. The business case had originally been approved at $22.6 million but was later expanded to $45.5 million after the work was taken to market Sloppy tax system controls threaten South Australian revenue base. ( Report RevenueSA Information Online system: October 2016 )

New York Times op-ed: We Can Fix Corporate Taxes, by David Leonhardt

New York Times op-ed: The Big Companies That Avoid Taxes, by David Leonhardt:
Donald Trump has become the country’s most notorious tax shirker. And while his long avoidance of federal income taxes is extreme, it’s also part of a larger problem.
The most affluent and powerful parts of our society have too easy a time legally avoiding taxes.
Consider corporate taxes, which ultimately tend to be paid by the well-off, because they own the most stock. The official corporate rate is 35 percent, infamously higher than in any other advanced economy. Yet there are so many loopholes that companies often pay relatively little in tax.
Many companies work hard to shroud how much they really pay, sprinkling various figures throughout their complex financial statements. But companies must report one number that provides a good glimpse. It’s called cash taxes paid — the combined amount that a company pays in federal, state, local and even foreign taxes.
I asked the analysts at S&P Global Market Intelligence to calculate this number since 2007 for this country’s 500 largest public companies, and the results reveal a broken tax system. Fixing it should be an early priority for the next president. If Hillary Clinton wins, it may well be.
Corporate Tax Problems And Solutions

A graphic from the Tax Foundation illustrates how bad it’s gotten:
Calling it the “length of the tax code” is wrong. That is “only” a few hundred pages. But it this is still a reasonable rough summary of the complexity taxpayers have to deal with.
We need another round of simplification. The cost of individual compliance for individuals continues to go up. Our corporation tax system is arguably the worst in the developed world. The tax law is sowed with land mines ready to explode the finances of taxpayers for innocent paperwork missteps. But given how awful our politics are, another round of tax reform seems far away.

David Gamage (UC-Berkeley, moving to Indiana) presents Tax Cannibalization and Fiscal Federalism in the United States, 111 Nw. U. L. Rev. ___ (2017) (with Darien Shanske (UC-Davis)), at Toronto today as part of its James Hausman Tax Law and Policy Workshop Series:
The current structure of U.S. federal tax law incentivizes state governments to adopt tax policies that inflict costs on the federal government, at the expense of national welfare. We label this the “tax cannibalization problem.”
This article introduces the tax cannibalization problem to the law and policy literatures for the first time. This article also explains how U.S. federal tax law might be restructured so as to alleviate the tax cannibalization problem — to counteract the perverse incentives currently leading U.S. state governments to design their tax systems so as to, in effect, wastefully devour federal tax revenues.

It's time to reduce the amount of physical cash floating around the globe to help combat tax evasion and other illicit activities, Harvard professor and renowned economist Ken Rogoff told Mr Mitchell this week ...
Harvard economist Kenneth Rogoff believes that the solution is to get rid of cash. In a new book, he argues that abolishing $100, $50, and perhaps even $20 bills will seriously inhibit crime and tax evasion while doing little to hamper legitimate commerce.  Ken Rogoff

Former IRS Special Agent Indicted on 9 Tax Fraud Charges, Faces up to 41 Years in Prison

Orwell should be read in conjunction with Dostoyevsky, as the NSW government's promotion of this project as "A western city bypass of the CBD" and as an improvement in "travel time and reliability for bus services" on this strategic road corridor is an exercise in doublespeak.
 Letters: WestConnex, tax cuts and political farce