Tax News Dec. 20 - 23

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News
THURSDAY
States taxing themselves to death
High taxes kill states. There can be no better evidence than the 2010 Census. The states that lost House seats -- because they're shrinking, relative to the nation -- had taxes 27 percent higher than the ones that gained seats.

WEDNESDAY
Census: Fast growth in states with no income tax
...the 2010 reapportionment gives Texas four additional House seats. In contrast, California gets no new House seats, for the first time since it was admitted to the Union in 1850.
Faulty Tax Break May Leave Millions With Surprise Bill
IRS officials knew which taxpayers were affected but didn't alert them directly, Treasury inspector general says.
Economists: Reform the tax code
Nearly half of economists surveyed by CNNMoney.com think overhauling the current system would be the best tax policy going forward. Reform would mean lower tax rates but an end to many of the deductions and special treatment enjoyed by certain taxpayers.

MONDAY
Biden: Obama tax deal 'morally troubling'
Vice president says pledge to middle class couldn't be kept.

Economist Comments
THURSDAY
Tax Cutters Set Up Tomorrow's Fiscal Crisis: Simon Johnson
The truth is, the tax deal moved us closer to a fiscal crisis, just as the euro zone now is experiencing.
Taxes and the Top Percentile Myth
A 2008 OECD study of leading economies found that 'taxation is most progressively distributed in the United States.' More so than Sweden or France.
Will the Tax Bill Stimulus Create Economic Growth?
Unless the government cuts spending, the result of tax cuts will be a higher budget deficit; this will divert more capital away from productive uses to service the debt.

WEDNESDAY
Spare us the death tax - for now
The new law won't make a dent in how much the rich can leave their heirs, but don't think the battle is anywhere near over.

TUESDAY
Ducking Higher Taxes
Oregon raised its income tax on the richest 2% of its residents last year to fix its budget hole, but now the state treasury admits it collected nearly one-third less revenue than the bean counters projected.

MONDAY
Estate Tax Not Justifiable
The real reason for the tax is class enmity. It's an ancient view of wealth that equates entrepreneurial success with theft.
Public vs. private retirements
Government workers get better deals -- paid for by taxpayers.

Blogs
THURSDAY
Oregon’s Millionaire’s Tax Doesn’t Pan Out
To close its $3.8 billion FY 2010- FY 2011 projected budget gap, Oregon has relied on an evaporating stimulus, budget cuts of roughly 9 percent and tax increases. The state’s income tax was raised with a new top rate of 11 percent. However the tax on the richest two percent of residents hasn’t performed as expected.

WEDNESDAY
Secondary Sources: Fallen Heroes, Economics of al Qaeda in Iraq, Tax Calculator
The Tax Policy Center has updated its tax calculator.
Oregon’s Millionaire’s Tax Doesn’t Pan Out
The tax applies to stocks and capital which means Oregon has “virtually the highest capital gains tax in North America.”

TUESDAY
‘Meanwhile, de Rugy Goes All Laffer Curve’
The primary reason for the increase in the share paid by the rich after the tax cuts isn’t that they made more money than before, a thought unbearable to Chait. Rather, it is that the Bush-era tax cuts reduced the taxes paid by middle- and lower-income families across the board and even kicked a lot of people at the bottom of the income distribution off the tax rolls altogether...
You Say 'Tax,' I say 'Penalty'
...a tax subsidy is a subsidy: you are enticing people to do something by offering them money. But because this adds the possibility of not getting the money if you don't do whatever they're subsidizing, [Tim]'s calling this coercion.
Why We Need a Tax AND Spending Cut
Under either scenario, a reduction in lump-sum taxes—unaccompanied by a reduction in spending—fails to jump-start the economy the way politicians hope that it might.

MONDAY
How middle-income taxpayers will benefit from new tax law
If you're a middle-income wage-earner, the only major change you'll notice from the bill passed by Congress yesterday—and expected to be signed shortly by President Obama—is in your paycheck.

Reports
WEDNESDAY
The Value-Added Tax Is Wrong for the United States
While a VAT has some advantages to the current U.S. tax code, adding the VAT to current federal taxes—as proponents propose—would realize none of these benefits and would instead depress the economy.