Posts Tagged ‘taxes’

April 20 roundup

Obama administration swats inversions, Pfizer deal collapses

After relatively cautious regulatory tightening on corporate inversions failed to deter a plan by Pfizer to embrace foreign domicile, the Obama administration came out with drastic new guidance that will keep accountants and lawyers busy for years with new disputes and uncertainties. Tax law is supposed to be relatively stable, predictable, and reliable for purposes of letting enterprises plan rationally, but that’s when political considerations don’t come first [Paul Caron, TaxProf citing Victor Fleischer, NYT and other links; earlier on inversions including Burger King episode] The underlying arrogance of U.S. overseas corporate tax policy: “We are unique among advanced nations in claiming taxes on global profits” [Hodak Value] Why corporate inversion makes moral sense and promotes healthy tax competition between jurisdictions [Daniel Mitchell, Cato and in January at Fortune]

Related: voters who believe in rule by executive fiat have so many choices this year, Bernie Sanders high among them [@joshgreenman on Twitter]

Connecticut governor: let’s not tax Yale’s endowment, actually

“A tax proposed by top legislators on the earnings of Yale’s sizable endowment was shot down Tuesday by the administration of Gov. Dannel P. Malloy. …The proposal – backed by Senate President Pro Tem Martin Looney and Appropriations Committee Co-chair Toni Walker, both Democrats from New Haven – [had] generated national attention.” [Connecticut Mirror] I modestly proposed that Yale consider moving in part or full to some jurisdiction that would leave its endowment alone, much as General Electric, which had been the largest corporation headquartered in Connecticut, chose recently to toddle off to Boston in search of a better climate. Ira Stoll picked up and expanded on my idea in a column reprinted in the Hartford Courant, and Florida Gov. Rick Scott promptly got into the act by inviting Yale to relocate to the Sunshine State. More: Courant editorial (“Idea Of Yale Fleeing Taxes Makes Connecticut Look Bad”) And I’m interviewed in this WTNH story.

Banking and finance roundup

  • Bernie Sanders still rants and raves about Glass-Steagall Act. Who will break the news to him? [Catherine Rampell/WaPo, P.M. Carpenter (Krugman, Pearlstein in accord with Rampell), earlier] “Hillary Clinton vows to go ‘well beyond’ Dodd-Frank” [Housing Wire via Kevin Funnell]
  • “In the past, ‘financial institutions were unwilling, for relationship reasons, to litigate against each other…That has changed dramatically.'” [Daniel Fisher quoting New York attorney Brian Fraser]
  • “Government Thinks You’re Too Dumb To Try Crowdfunding” [Ben Weingarten, The Federalist]
  • “If every bank behaved like Abacus, the financial crisis wouldn’t have occurred.” So guess which bank got prosecuted [Jiayang Fan, The New Yorker back in October]
  • Billions in free money for consumers, just by regulating credit card fees! Sorry, it’s not that simple [Todd Zywicki]
  • “The war against cash”: government vs. the cash economy [Daniel Mitchell, Cato, first and second post]
  • New IRS authority to secure revocation of passports should give pause to everyone concerned about American liberty [Investors Business Daily]

Banking and finance roundup

  • Trying to buy gift cards in bulk as an employee bonus, Coyote discovers anew that the government hates cash;
  • Initial public offerings are drooping again, regulation one reason [Thaya Knight, Cato]
  • A dissent from the lamentations, here and elsewhere, on the decline of small community banks [Ira Stoll] “Fed’s Tarullo says looking into smaller banks’ concerns” [Business Insider]
  • Berned out? Financial transactions tax “one of the more overrated ideas in American Progressive political discourse” [Tyler Cowen, Wikipedia on Sweden’s experience via @aClassicLiberal on Twitter] And Sen. Sanders continues to express incredulity on Twitter about college loans’ carrying higher interest than home mortgages do, despite attempts to enlighten him on the whole topic of secured lending and collateral [@tedfrank]
  • Video of Federalist Society convention panel on constitutionality of administrative law judges at SEC and elsewhere with John S. Baker, Jr., Stephen Crimmins, Todd Pettys, Tuan Samahon, moderated by F. Scott Kieff;
  • Consumer Financial Protection Bureau ban on contractual arbitration will help class action lawyers, few others [Todd Zywicki, Mercatus]
  • “How US policies to stop terrorist financing end up hurting innocent families abroad” [Dylan Matthews, Vox] Money laundering regs, “de-risking” result in many bank closures in U.S.-Mexico border areas, hassles result for local residents and businesses [Kevin Funnell]

Bounty-hunting lawyer collects Illinois taxes nationwide

Wineries that ship to customers nationwide are among the latest targets of a Chicago attorney who has developed a lucrative freelance enforcement niche. Steven Diamond and his firm of Schad, Diamond and Shedden “have filed hundreds of suits against various companies in industries such as cookware, flowers and motorsports” and more recently beverage makers under “an Illinois law that requires businesses to collect sales taxes for the state, not only on what they sell, but on shipping-and-handling charges. A whistleblower rule allows anyone within the state to sue in the name of Illinois and collect any recovered funds.” [Wine Spectator] While a number of other states also tax shipping charges, Illinois authorities, unable to agree on how to interpret a relevant decision by their state’s high court, have given conflicting guidance on when taxes are owed. [Wines and Vines, Tom Wark, Schiff Hardin, WTAX]

P.S. Related on the practice of tax farming in the Roman Empire and pre-Revolutionary France, and latter-day parallels, here, here, and here.

But you can’t check out

Why did a GOP Congress just give the Internal Revenue Service new power to yank Americans’ passports and with it, the right to travel? “Renouncing citizenship isn’t necessarily a way out any more -– the State Department just raised the fee for that by 422%, to nearly $2,500.” [Iain Murray, National Review] And: “We think of passports as being needed only for international travel, but some people may find that passports are also required for domestic travel in 2016.” [Robert Wood, Forbes]

“A right to speak anonymously?”

Attorneys general in California and New York are demanding that 501 (c)(3) nonprofit organizations disclose their donor lists to the state. At the recent Federalist Society National Lawyers’ Convention, that issue and others were discussed by a panel consisting of Andrew Grossman (BakerHostetler), Stephen Klein (Pillar of Law Institute), Paul S. Ryan (Campaign Legal Center), Hans von Spakovsky (Heritage Foundation), with Michigan Supreme Court Chief Justice Robert P. Young, Jr. as the moderator. From the summary:

Supporters of mandated disclosure of the source of speech (or of money used to pay for speech) claim it can provide important information to the public and the legal system. But opponents say it violates privacy rights and can also deter the sources from speaking or contributing.

This debate also applies to reporters’ confidential sources. In both situations, disclosure (of who contributed or spent, or who a confidential source was) may provide useful information to voters, prosecutors, civil litigants, judges, or jurors. In both situations, requiring disclosure of the source may deter people from contributing to controversial campaigns or organizations, or from talking to journalists. Politically, people tend to react differently to these reactions – confidentiality of contributors tends to be more supported by conservatives, while confidentiality of journalists’ sources tends to be more supported by liberals. But structurally, are these issues similar? This panel will consider both these questions together.

A playlist of all the videos from the Federalist Society convention is here.