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Monday, July 30, 2018

Nothing is Certain Except Death and Taxes: The Lack of Policy Uncertainty from Expiring 'Temporary' Taxes

Yet it is amost certain that Geraint Thomas is set to win Tour de France after taking yellow jersey to Paris Guardian




Vale Nancy and Mary Ellis, wartime volunteer who flew Spitfires, dies at 101
Sagit Leviner (Ono), In the Eye of the Beholder: Public Opinion on Tax Justice

An unfortunate side effect of democracy is that it incentivizes ignorance, irrationality, and tribalism. So says Jason Brennan. He has a cure: epistocracy

A tax authority wants to take actions it knows will foster the greatest degree of voluntary taxpayer compliance to reduce the "tax gap." This paper suggests that even if a tax authority could attain a state of complete knowledge, there are constraints on whether and to what extent such actions would result in reducing the macro-level tax gap. These limits are not merely a consequence of finite agency resources. They are inherent in the system itself.
What is the policy uncertainty surrounding expiring taxes? How uncertain are the approvals of routine extensions of temporary tax policies? To answer these questions, I use event studies to measure cumulative abnormal returns (CARs) for firms that claimed the U.S. research and development (R&D) tax credit from 1996-2015. In 1996, the U.S. R&D tax credit was statutorily temporary but was routinely extended ten times until 2015, when it was made permanent. I take the event dates as both when these ten extensions of the R&D tax credit were introduced into committee and when the extensions were signed by the U.S. president into law. On average, I find no statistically significant CARs on these dates, which suggests that the market anticipated these extensions to become law.

The amount of corporate taxes collected by the federal government has plunged to historically low levels in the first six months of the year, pushing up the federal budget deficit much faster than economists had predicted.

 

Regulatory Report: US penalizes Swiss bank on graft, new FATF ...

Sony sold AU$548.4 million-worth of goods in Australia last year

 

Tax office takes Simone Holzapfel's Shac Communications to court ...

Businesses reject ATO's anti-cash claims


 ATO issues over 500 commutation authorities

Perth properties frozen in $7.5m tax case against sandalwood trader

Northern Territory's first illicit tobacco bust exposes 17 acres of crops ...

It was the first warrant executed by the Australian Border Force and Australian TaxOffice, with help ...
Six tonnes of tobacco seized from illegal crops in Northern Territory The Guardian

Jennifer Nou (Chicago), David Weisbach (Chicago), and I have been working this summer on a framework for quantitative cost-benefit analysis of tax regulations. At Whatever Source Derived and the Yale Journal on Regulation's Notice and Comment blog, we have posted a preview of our approach with an application to pending regulations regarding the new passthrough deduction. From the post:
The Treasury Department and the Internal Revenue Service (IRS) have submitted a proposed rule regarding the new passthrough deduction to the Office of Information and Regulatory Affairs (OIRA) for review. This appears to be the first tax regulation labeled as “economically significant” that Treasury and IRS have submitted to OIRA since an April 2018 memorandum of agreement set forth a new process for the centralized review of tax regulations. That process requires Treasury and IRS to submit a regulatory impact analysis to OIRA before publishing any “economically significant” rule — one that is “likely” to “have an annual non-revenue effect on the economy of $100 million or more.” That analysis must include, “to the extent feasible,” a quantification of the proposal’s benefits and costs.

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