News

Key Findings Extrapolating from recently revised state revenue forecasts yields an estimated nationwide $121 billion decline in state tax collections across FYs 2020 and 2021 against a FY 2019 baseline, and $191 billion compared to initial tax revenue projections for those two years. These estimates are consistent with the results of other recent analyses, and,
0 Comments
Last week, former Vice President and presumptive Democratic presidential nominee Joe Biden released a set of economic proposals aimed at increasing investment in research & development (R&D) and “breakthrough” technology in energy. Biden should include canceling the upcoming amortization of R&D expenses in 2022, which would pair well with his plan and remove a headwind
0 Comments
Today the U.S. Trade Representative (USTR) announced new tariffs in response to the French digital services tax. The tariffs of 25 percent on $1.3 billion worth of trade would not go into effect until January 6, 2021. The tariffs would apply to several make-up products, handbags, and assorted soaps. In January, the U.S. and France
0 Comments
The following comments were submitted to the Office of the United States Trade Representative regarding docket number USTR-2019-0009. Thank you for the opportunity to provide comments on the Section 301 Investigation. These comments summarize the discriminatory nature of Digital Services Taxes (DSTs) which arise from their design. These comments also provide some details on the policies
0 Comments
Last week, National Taxpayer Advocate Erin M. Collins released her first report to Congress on the challenges taxpayers have faced related to the coronavirus pandemic, including the tax changes made through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The National Taxpayer Advocate’s findings show that policymakers should prioritize simplicity in the next round
0 Comments
Corporate taxation has evolved significantly over the last several decades. Corporate income tax rates have come down significantly. Countries have redesigned their tax bases by changing the treatment of losses, interest, and capital costs. International tax rules have also been overhauled. A new report from the Organisation for Economic Co-operation and Development (OECD) provides a
0 Comments
The Government Accountability Office (GAO) recently released a report revealing that almost a half-million taxpayers missed their total rebate payment due to complications over disbursing funds to non-filers with eligible dependents. Taxpayers who do not regularly file tax returns—usually those who do not owe tax because they earn lower incomes or who receive federal disbursements
0 Comments
The COVID-19 pandemic has damaged the American economy, as unemployment has skyrocketed. Despite job growth in May, the unemployment rate still sits at more than 13 percent, its highest point since the Great Depression. But even before the pandemic, American workers had experienced slow wage growth, for a variety of reasons. Policies to create jobs
0 Comments
Countries around the world have implemented and continue to implement emergency tax measures to support their economies during the coronavirus (COVID-19) crisis. Providing tax relief to the people and companies that are most affected, until the emergency abates, is welcome, as the health issue has created a substantial economic shock. Taxes that require regular payments
0 Comments
In many countries, investment income, such as dividends and capital gains, is taxed at a different rate than wage income. Today’s map focuses on how capital gains are taxed, showing how capital gains tax rates differ across European OECD countries. When a person realizes a capital gain—that is, sells an asset for a profit—they face
0 Comments
Key Findings Transfer pricing rules will come under pressure during the economic downturn. Businesses will need to adjust their transfer pricing to reflect the changing economic circumstances with limited real-time data on comparable entities and transactions. Royalty arrangements with production facilities, distributor returns, and loss attributions all create decision points for companies to adjust their
0 Comments
Lawmakers can improve the cost recovery treatment of capital investment by allowing full expensing or by approximating full expensing by adjusting depreciation deductions to equal the present value of full expensing. This latter approach of capital cost indexing (sometimes called a neutral cost recovery system or NCRS) lowers the short-term cost of the policy to
0 Comments
This month, the German government agreed to a new round of fiscal support for the economy in light of the challenges from the ongoing pandemic. The total cost of the new package is €130 billion and is in addition to the supplementary budget adopted earlier in the year of €156 billion. Combined, the two fiscal
0 Comments
Businesses are required to remit Value-Added Taxes (VAT) on goods and services sold to final consumers. The administrative burden of complying with the tax varies significantly across countries. Today’s map shows how complex—or simple—it is to remit VAT in European countries. One way of estimating the VAT’s administrative burden is to measure the time needed
0 Comments
The Organisation for Co-operation and Economic Development (OECD) has compiled tax revenue data for countries around the world—including 26 Latin American and Caribbean (LAC) countries, where tax revenue as a percent of GDP is on average 11 percentage points lower than in other regions. On average, the tax-to-GDP ratio for 25 countries (excluding Venezuela due
0 Comments