Will tax talk dominate the GOP debate tonight in Michigan? Will this be the night that the four remaining candidates elaborate on how they’d pay for their proposed and unprecedented tax cuts? The Tax Hound hopes so. She can hardly wait for the tax plans to garner more attention… and wishes everybody felt the same way.
Elsewhere in Michigan: The feds nab a tax fraud ring. They’ve indicted 34 people from Battle Creek on charges of conspiring to defraud the IRS of $22 million through false tax returns. An investigation dating back to 2008 alleges that the defendants used information from patients and employees of the Battle Creek Veterans Affairs Medical Center and from inmates of the Michigan Department of Corrections to file 4,668 fake federal income tax returns claiming over $22 million in refunds between 2007 and 2014.
In Kansas: Tax receipts are too low, so the Governor cut the education budget. Receipts were $53 million lower than estimated in February. Individual income tax revenues came in $27 million under projections, sales tax revenues were short by $12 million, and corporate income tax revenues were under budget by $7.7 million. GOP Governor Sam Brownback says the state has a spending problem, not a tax problem, so he said he’d cut the university system’s budget by $17 million.
Hatch’s business tax reform: Don’t hold your breath. The Finance Committee Chairman hoped to have a plan this month. But Politico reports that Hatch is lowering expectations for his plan to address the double taxation of corporate profits. Maybe in May. Maybe later.
Budgeting for federal lending programs leaves much to be desired. The Congressional Budget Office and the Government Accountability Office are squabbling over how best to budget for federal lending support for mortgages, student loans, the Export-Import Bank, and the like. As Urban Institute’s Donald Marron points out: “Over a decade, federal lending support for [those programs] could appear $300 billion more costly under fair-value budgeting than under credit reform.” He demonstrates a third, better way that captures the strengths of each method and avoids their flaws. One major issue: how to account for the budgetary effects of loan programs where the government both pays and receives interest over decades.
Out in British Columbia: The carbon tax, tested. The right-leaning British Columbia Liberal Party introduced a tax on carbon emissions in 2008. The tax grew from C$10 per ton of carbon dioxide in 2008 to C$30 dollars by 2012 (about $22.20). Over that time, emissions fell by 5 to 15 percent with “negligible effects on aggregate economic performance,” according to a study last year by economists at Duke University and the University of Ottawa.
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