Check out this web site with the tax rates (individual income tax, corporate income tax, and value-added tax) for 55 countries around the world. More comprehensive data are available on the OECD web site here.
Paul L. Caron
Dean
Pepperdine Caruso
School of Law
-
Tax Foundation Publishes Tax Watch
The Tax Foundation has published the Spring 2005 issue of Tax Watch, with articles on:- Free Trade and Taxes: Will the WTO Slam U.S. Exporters?
- Who Pays the AMT?
- What’s the Real Cost of the Income Tax?
-
Tax Consequences of Buying and Selling Uniform Numbers
Joel Newman (Wake Forest) passed along an interesting tax angle in today’s New York Times story, What Is a Number Worth? Some Athletes Pay the Price, which recounts how professional athletes who join a new team often will pay a current player for the right to wear a particular uniform number. Some examples in the article:
Player Payments for Right to Wear Particular Uniform Number
Payor Player
Payee Player
Payment
Team/Number
Clinton Portis
Ifeanyi Ohalete
$40,000
Washington Redskins/26
Brian Jordan
Fredi Gonzalez
$40,000
Atlanta Braves/33
Kellen Winslow
Aaron Shea
$30,000
Cleveland Browns/80
Ricky Henderson
Turner Ward
$25,000
Toronto Blue Jays/24
Mitch Williams
John Kruk
2 Cases of Beer
Philadelphia Phillies/28
Roger Clemens
Carlos Delgado
Rolex Watch
Toronto Blue Jays/21
Tom Glavine
Joe McEwing
Baby Nursery
New York Mets/47
Eli Manning
Jeff Feagles
Florida Vacation
New York Giants/10
Plaxico Burress
Jeff Feagles
New Kitchen
New York Giants/17
Among the many tax issues raised in these cases:
Payor Player
- Currently deductible as ordinary & necessary business expense?
- Amortization deduction? Over what period?
Payee Player
- Income upon receipt of a valuable number?
- Gain on sale? If so, what is the amount of basis to offset against the amount realized?
-
Levine Criticizes WSJ Article on Estate Tax Repeal
Stuart Levine at Tax & Business Law Commentary follows up on Tom Herman’s Wall Street Journal piece I blogged yesterday, Estate Tax Repeal May Hurt Some:
[Herman] reported … that people who would not benefit from the abolition of the estate tax would be exposed to tax liability they currently escape due to the operation of the basis step-up rules. The estate tax repeal would likely abolish these rules, thus subjecting capital gains to income tax, in cases where, under current law, the gains would escape tax entirely.
The WSJ is reputed to have a somewhat split personality — outrageously ideological on its editorial page, scrupulously honest in its actual news reporting. Herman’s article, which I believe falls into the news reporting category, erodes one’s confidence in the reputation of the reporting side. Start with the headline itself, indicating that the repeal may hurt "some." Wrong: … The simultaneous repeal of the estate tax and of the basis step-up rules would impose a tax on many, offering relief to only a few. Consistent with Republican philosophy, of course, the few are very rich, the many merely the well-to-do and the simply wealthy….
A lot of people, including people in the middle class, benefit from the basis step-up rules. As the estate tax law changes currently enacted take effect, only the few very rich will benefit from a repeal of the estate tax. The losers outnumber the winners by at least a factor of 20. The repeal of the estate tax will have the effect of imposing tax on the less well-to-do to satisfy the really, really wealthy. This is not subtle or tricky. Any decent reporter whose beat is taxes should have known about the issue from the beginning.
-
3rd Circuit Treats Unallocated Support Payments During Divorce as Alimony, Contrary to Tenth Circuit
Law.com has an interesting article on this week’s Third Circuit decision, Kean v. Commissioner, Nos. 04-2931 & 04-3018 (3rd Cir. May 10, 2005), holding that unallocated support payments during divorce should be treated as alimony (and hence as income to the payee spouse).
Where support payments are unallocated, as in this case, the entire amount is attributable to the payee spouse’s income. Otherwise, we would be left with a situation in which the portion of the unallocated payment intended for the support of the payee spouse would be taxable to the payor spouse. This treatment of support payments is not accidental, and can benefit families going through a divorce.
By ordering the payor spouse to make an unallocated support payment taxable in full to the payee spouse, the couple may be able to shift a greater portion of their collective income into a lower tax bracket. Consequently, an unallocated payment order not only frees the parents from restrictive court instructions that dictate who pays for what, but may allow the parties to enjoy a tax benefit at a time when they face increased expenses as they establish independent homes. This advantage would be lost by taxing all unallocated payments to the payor spouse.
The Third Circuit’s decision is contrary to that reached by the Tenth Circuit in Lovejoy v. Commissioner, 293 F.3d 1208 (10th Cir. 2002).
-
Monahan on The Promise and Peril of Ownership Society Health Care Policy
Amy Monahan (Missouri-Columbia) has posted The Promise and Peril of Ownership Society Health Care Policy (forthcoming Tulane Law Review) on SSRN. Here is the abstract: There has been a fundamental shift in tax policy over the past many years away from paternalistic social policies to the embrace of personal responsibility and ownership. The shift in retirement savings tax policy has received the most attention, but the shift which is taking place in health care tax policy is just as profound. Ownership society proponents believe that introducing market incentives into the demand-side of health care financing will help to control increasing costs, while having the additional benefit of allowing tax-favored individual ownership of health care savings. In 2003, the tax code was amended to grant tax benefits to the ownership society version of health care – a tax-favored health savings account coupled with high deductible health insurance coverage. This tax policy shift is consistent with the broader fundamental shift in social tax policy that has taken place over the past several years.
This article considers both the promise of this fundamental shift in health care policy, as well as the potential perils. There is much that is appealing about ownership society health care policy. It empowers individuals to make their own medical spending decisions, rather than putting such power in the hands of physician gatekeepers or health insurance administrators. It also promises to lower costs, by creating for the first time incentives for Americans to be cost-conscious in their medical spending decisions. Unfortunately, as the article concludes, there are many perils that must be adequately addressed and dealt with if ownership society health care is to truly effect health care reform.
-
Center for American Progress on A Fair and Simple Tax System for Our Future
The Center for American Progress has published A Fair and Simple Tax System for Our Future, 107 Tax Notes 767 (2005), also available on the Tax Analysts web site as Doc 2005-9233, 2005 TNT 89-41. Here is the Executive Summary:The current tax code is unfair, is unnecessarily complex, and has failed to meet our national priorities. Today, we are faced with a fundamental choice for our tax structure: continue the policies that have failed the vast majority of taxpayers and our country for the benefit of a few, or reform the tax system consistent with progressive principles. It is time for a fairer and simpler tax system that reduces the massive deficits created over the last four years, strengthens the middle class while honoring their work, and creates opportunity for Americans of all income levels to succeed.
Restoring a fair, simple, and pro-opportunity tax system, while generating the resources necessary to meet our looming challenges, requires moving our tax system in an ambitious new direction. The Center for American Progress proposes a comprehensive tax reform plan that rewards hard work and promotes shared prosperity. We propose a plan that would tax each kind of income according to the same rate schedule, whether the income is derived from wages, salaries, capital gains, or dividends.
Our plan shifts the share of taxes away from the regressive payroll tax and onto a restructured income tax. It reduces complexity by establishing a simpler, more progressive three-rate structure and it eliminates the Alternative Minimum Tax, in addition to closing corporate and individual loopholes. Our plan enhances opportunity by reducing the deficit to strengthen the economy and it promotes retirement savings for millions of Americans who currently receive no savings incentives through the tax code. Furthermore, our plan improves the Earned Income Tax Credit and expands the number of families eligible to receive the federal child tax credit. Ultimately, the Center for American Progress’s reform plan increases the take-home pay of low- and middle-income families and generates the funds our country needs to meet its vital domestic and national security commitments.
-
Gara on Challenging the Finality of Tax Court Judgments
Stephen C. Gara (Old Dominion University, College of Business & Public Administration) has published Challenging the Finality of Tax Court Judgments: When Is Final Not Really Final?, 20 Akron Tax J. 35 (2005). Here is part of the Introduction:The present article reviews this statutory finality rule and the development of equitable exceptions to it, particularly the application of the fraud upon the court doctrine. The next section provides an overview of the Tax Court, followed by a discussion of judgment finality and § 7481. Part four discusses the fraud upon the court doctrine and its applicability in reviewing final judgments. The development of other exceptions to § 7481 is analyzed next. The article concludes with an assessment of the current state of the Tax Court’s authority to make exceptions to § 7481.
-
Webcast and PowerPoint Presentations from Today’s Meeting of President’s Tax Reform Panel
A video webcast and PowerPoint presentations are available from today’s meeting of the President’s Advisory Panel on Federal Tax Reform, which focused on business tax reform proposals:Perspectives on Business Tax Reform
- PowerPoint Presentation by R. Glenn Hubbard (Dean, Columbia Business School), Business Taxation and Tax Reform
Panel 1: Integration of Corporate and Individual Tax Systems
- PowerPoint Presentation by Alvin Warren (Harvard), Integration of Corporate and Individual Income Taxes
- PowerPoint Presentation by Kenneth W. Gideon (Skadden, Arps, Slate, Meagher & Flom), The Comprehensive Business Income Tax
Panel II: Business Tax Simplification
- PowerPoint Presentation by David J. Shakow (Pennsylvania), Taxation of Private Enterprises
- PowerPoint Presentation by Edward D. Kleinbard (Cleary, Gottlieb, Steen & Hamilton), The Business Enterprise Income Tax
Panel III: International Income Taxation
- PowerPoint Presentation by James R. Hines Jr. (Michigan, Ross School of Business), Exempting Foreign-Source Dividends from U.S. Taxation
- PowerPoint Presentation by Stephen E. Shay (Ropes & Gray), International Tax Reform: Perspectives on Reforming U.S. Taxation of Foreign Business Income
See:
TaxProf Blog delivers timely, insightful coverage of tax law and legal education to inform, connect, and inspire scholars, practitioners, and students.
