The secret’s out: Luxembourg sent “comfort letters” to 300 companies and slashed their tax bills. The companies include Pepsi, AIG, Ikea, FedEx, and Deutsche Bank. The International Consortium of Investigative Journalists review leaked documents which show that companies channeled hundreds of billions of dollars through Luxembourg and saved billions in taxes, thanks to the tiny nation’s favorable private tax rulings. Luxembourg denies any wrongdoing. State taxes and running for Governor: Message received. TPC’s Howard Gleckman breaks it down in his review of five of the races. Voters were heard over the din of negative ads and empty promises: “Taxes are too high and–all else equal—we will punish those politicians we hold responsible for raising them and reward those who cut them.” As for the newly elected Governor of Illinois and millionaires: Illinois said yes, both to Republican Bruce Rauner for Governor, and to a non-binding vote on an additional 3 percent tax on income over $1 million to help fund schools. The proposed tax had been supported by outgoing Governor Pat Quinn, but isn’t expected to get very far with Governor Rauner. Illinois’ financial picture could get gloomier when Rauner takes office. Its single 5 percent individual income tax rate will drop to 3.75 percent. The corporate income tax rate will drop from 7 percent of net income to 5.25 percent. State gas tax hikes: Rock, meet Hard Place. Massachusetts just repealed the automatic indexing of its gasoline tax to inflation. This forces legislators to vote for gas tax increases. Bad move, says TPC’s Richard Auxier. As Auxier explains in his new brief, when gasoline is taxed by the gallon, consumption drives revenues. As the demand for fuel-efficient cars grows, the obvious way to raise gas tax revenue is to raise rates. Voters hate that, and politicians just want to be loved. What can lawmakers do about state transportation funding? Barring a tax on the miles a person drives, they can either re-allocate general funds (fed by other taxes, of course) or cut transportation spending. New from Treasury: It’s considering new curbs on inversions and earnings stripping, according to Douglas Poms of Treasury’s International Tax Counsel. At a meeting at the American Institute of Certified Public Accountants’ Tax Division, he said those curbs would be proposed in the near (but unspecified) future, along with promised regulations on the anti-inversion notice released in September. Other issues that might be addressed by Treasury include post-inversion benefits and inappropriate treaty benefits. Last call for next week’s NTA conference: Looking for a tax fix and a long weekend in Santa Fe? The National Tax Association will hold its 107th annual conference next Thursday-Saturday. MIT’s Jim Poterba will receive the 2014 Holland Award, and Nobel Laureate Joe Stiglitz and Assistant Treasury Secretary for Tax Policy Mark Mazur will deliver luncheon speeches. More than 60 research sessions will include panels on taxation of multinational corporations, state and local fiscal issues, taxes and charitable giving, and tax policy and income inequality. If you feel like running some numbers this weekend: The IRS has released new data on partnership returns. Twenty-three tables are now available containing Tax Year 2012 statistics for partnerships. They cover balance sheets, trade or business income and deductions, portfolio income, rental income, and total net income. Historical tables provide balance sheet and income statement data, as well as counts of partnership returns based on size of assets and receipts. Happy tabulating! Interested in subscribing to The Daily Deduction, the Tax Policy Center summary of the day’s tax news? Sign-up here for free access. If you’d like to tell us about a new research paper or have any comments about our new feature, write us at [email protected].