Tax
How High are Distilled Spirits Taxes in Your State?
Of all alcoholic beverages subject to taxation, stiff drinks—and all distilled spirits—face the stiffest tax rates. Ostensibly, this is because spirits have higher alcohol content than the other categories, like wine and beer. This round of information is on us, so help yourself to the map below to see whether you’re shaken or stirred by how your state’s…
Read MoreChallenges for Transfer Pricing in an Economic Downturn
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…
Read MoreWeighing the Benefits of Permitting Business Credit Cashouts in Phase 4 Economic Relief
As policymakers explore options for additional business tax relief in “Phase 4” of coronavirus relief legislation, one idea that has received renewed attention over the last week is allowing businesses to cash out business tax credits allowed under Section 38 of the Internal Revenue Code. This proposal would be strengthened by also permitting acceleration of…
Read MoreGermany Adopts a Temporary VAT Cut
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…
Read MoreSeattle Officials Return with New Proposal for Taxing Employment
Seattle’s city council—or at least a few of its members—are again gearing up for an effort to increase taxes on the city’s largest employers. The targets of the proposed taxes have been constant; the nature of the tax and what it is intended to fund has been a moving target. The latest proposal would place…
Read MoreD.C. Council to Consider Tax Hike Despite Balanced Budget
Many in the District of Columbia breathed a sigh of relief when Mayor Muriel Bowser (D) unveiled a balanced budget that managed to avoid painful spending cuts or raise taxes in the midst of the COVID-19 pandemic. Although the budget delayed some new spending and does include cuts to operating budgets, it represents a belt-tightening…
Read MoreInefficiencies Created by the Tax System’s Dependence on Economic Depreciation
One idea that would help the nation’s economic recovery during the coronavirus crisis would be moving to full expensing of capital investment. The depreciation debate might seem confusing, so the question at hand is: how, when, and by what amount can businesses recognize (or recover) the cost of a capital investment, like a piece of…
Read MoreColorado Tobacco Tax Bill Includes Positive Change
Thursday, Colorado Representatives Yadira Caraveo (D) and Julie McCluskie (D) as well as Senators Rhonda Fields (D) and Dominick Moreno (D) introduced HB1427 which, if approved by voters in November, would increase tobacco taxes in Colorado in three stages beginning January 2021. The tax on cigarettes would increase to $1.94 in 2021, to $2.24 in…
Read MoreNew Jersey Considers Bonds Paid for by Statewide Property Tax
As New Jersey lawmakers grapple with reduced revenues due to the coronavirus pandemic and the related economic downturn, they have turned to an unusual solution: the issuance of bonds that would be repaid, if necessary, through temporarily higher sales and property taxes. A4175, the vehicle for this option, has passed the Senate and moved to…
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