National Tax Journal articles from September 2005

National Tax Journal archives from September 2005

Tax holidays (and other escapes) in the American Jobs Creation Act.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... AN INTRODUCTION TO THE AMERICAN JOBS CREATION ACT The American Jobs Creation Act (AJCA) was signed into law on October 22, 2004. The heart of the bill is a repeal of an illegal trade subsidy--the Extraterritorial Income (ETI)...

The 2004 corporate tax revisions as a spaghetti western: good, bad, and ugly.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... INTRODUCTION The original purpose of the American Jobs Creation Act (AJCA), passed in 2004, was to eliminate the Extraterritorial Income provision (ETI) that had been found to be an export subsidy by the World Trade Organization (WTO). The...

A few things the tax reform panel needs to remember.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... "Drop Kick Me Jesus Through The Goalposts Of Life" This title of a country and western song describes succinctly, if not explicitly, the objective of an ideal tax reform. (1) To achieve this objective, the Tax Reform Panel needs to keep...

Remarks on David Bradford.(leading consumption tax advocate)(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... In tax reform circles, David Bradford is best known as a leading, or really the leading, consumption tax advocate. But he was an unusual sort of advocate. In law, we think of an advocate as someone who's paid to take a position. Thus, if you're...

Use of fiscal policy reaction functions in analyzing the macroeconomic effects of tax policy.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... INTRODUCTION A number of recent papers have looked empirically at the extent to which present and future fiscal policy reacts to past and anticipated future fiscal policy and economic developments. An estimated equation taken from one of...

The sustainability of health spending growth.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... INTRODUCTION Long-run federal budget projections show large imbalances in coming decades owing to two factors: the aging of the population and the assumed rapid growth in per capita health care expenditures. For example, in its long-run...

Deficits, interest rates, and the user cost of capital: a reconsideration of the effects of tax policy on investment.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... INTRODUCTION One of the principal goals of tax reform efforts is to improve the long-run performance of the economy. A frequently observed manifestation of this goal is the provision of tax incentives for firms to boost productive...

Confidentiality and taxpayer compliance.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... INTRODUCTION Confidentiality of individual taxpayer data is a long-held basic right of the U.S. system of tax administration. Section 6103 of the Internal Revenue Code sets the guidelines for confidentiality and for the limited disclosure...

The effects of tax software and paid preparers on compliance costs.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... INTRODUCTION In the past decade, there has been a dramatic shift in the way individual income taxpayers prepare and submit tax returns. In 1993, according to data reported in the IRS Taxpayer Usage Study (TPUS), 41 percent of taxpayers...

Keeping the faith: the permanent campaign against tax shelters.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... INTRODUCTION While perhaps not the most significant evidence in terms of dollars consumed, if ever there was an indication of the economic wastefulness of tax shelters and other tax motivated transactions, it is the countless hours and...

Changing the calculus: making tax shelters unprofitable.(35th Annual Spring Symposium and State Tax Program)
September 1, 2005... INTRODUCTION Taxpayers and professionals alike found tax shelters profitable in the late 1990s. Taxpayers garnered large tax savings, and professionals earned sizable fees from related services, with little offsetting downside. Over the...

Alternative methods of price indexing Social Security: implications for benefits and system financing.
September 1, 2005... INTRODUCTION An original intent behind Social Security's Old Age and Survivors insurance program was, according to President Franklin Roosevelt, to provide "some measure of protection for the average worker and his family against the loss...

Social Security at 70: principles, issues and alternatives.
September 1, 2005... INTRODUCTION A fundamental element of the debate over Social Security reform is which set of principles should describe the role of the program over the next century. One possibility, which we refer to as "collectivist principles,"...

Winners and losers under various approaches to slowing Social Security benefit growth.
September 1, 2005... THE FUTURE OF SOCIAL SECURITY FINANCES Under current projections, payroll tax revenues and accumulated interest in the Social Security trust fund will be insufficient to pay scheduled benefits when workers entering the labor force today...

Opting out of Social Security: an idea that's already arrived.
September 1, 2005... INTRODUCTION Current tax law allows workers to opt out, either partially or completely, of the Social Security system. Workers make this choice by opting to receive their compensation in forms not subject to the payroll tax. This decision...

Understanding the nuttiness of state tax policy: when states have both too much sovereignty and not enough.
September 1, 2005... INTRODUCTION Several years ago I published a paper on the nuttiness of state and local taxes (McLure, 2002). These are among the many nutty characteristics of state sales and use taxes: * Many services are exempt; * Internet...

Interstate tax uniformity and the Multistate Tax Commission.
September 1, 2005... INTRODUCTION The Multistate Tax Commission (MTC) was established out of concern over the lack of uniformity in interstate taxation and the fear that in the absence of voluntary uniformity the federal government would dictate the nature of...

Interstate tax coordination: lessons from the International Fuel Tax Agreement.
September 1, 2005... INTRODUCTION As regional economies have become more interconnected, the administration of tax revenue systems has become increasingly complex, motivating states to consider tax coordination efforts through a variety of arrangements to...

The political economy of the streamlined sales and use tax agreement.
September 1, 2005... INTRODUCTION The sales tax streamlining movement may well be the most significant development in state sales taxation since the genesis of the state sales tax in the 1930s as "a desperation measure" to make up for plummeting income and...