Tax Code Simplification Presidential Candidate-Style

One of the 17 presidential candidates recently said, “I can write a tax code in three pages.” Carly Fiorina is not alone among her fellow 2016 presidential contenders in advocating tax reform and simplification of the tax code. However, none is quite so ambitious.

I suppose that theoretically one could write a tax code on three sheets of paper that would raise enough revenue to fund the US government. Let us consider that challenge for a moment by measuring a baseline first. Then we can consider the issues of simplification.

Implementing the 'Plastax' in the UK

Last month, England became the latest government – and last among members of the UK – to pass a policy to combat the recent rise in the use of disposable plastic shopping bags, in its case a five-pence charge for each one.

While English newspapers warned that the new policy would create chaos, England is by no means the first to consider such a controversial policy. Several countries across the world and local governments have taken steps to address the environmental consequences of increased plastic bag use through regulation.

A Wale(s) of a Tax Strategy

Companies such as Apple, Starbucks, and Amazon are well known for legally using international law to their advantage when it comes to tax. Now a small Welsh town is mimicking their tactics. Independent traders in Crickhowell are moving their businesses “offshore” to avoid paying tax.

The Potential in Splitting Australia's GST into Two

The overflowing rubbish tips of Lagos, the Pacific Ocean garbage patch, and the huge electronic graveyard of Guiyu, China might seem irrelevant to Australia’s current debate over reforming the Goods and Services Tax. Yet all three of these far-flung places are testament to the world’s incessant habit of buying stuff and then later throwing it away – and Australian consumers are just as culpable as any.

It Appears that India Will Give a Goods and Services Tax a Try

India is moving towards introducing a Goods and Services Tax (GST). The GST would be a multistage comprehensive value added tax (VAT) encompassing both goods and services. Given the federal structure of India and the fact that taxation powers have been constitutionally assigned to different governments, the introduction of a GST would be a major indirect tax reform since independence. Both the federal and state governments will have concurrent taxation rights at every stage of production and distribution.

Finding the Middle Ground on Dividend Taxation

With tax reform back on the agenda, the future of dividend imputation remains uncertain.

Allowed in Australia since 1987, dividend imputation ensures companies and shareholders don’t end up paying tax on the same income, commonly known as “double taxation”. It means local company dividends come with a tax credit.

There is a perception among some that the early benefits of dividend imputation have been eroded due to the increasing globalisation of markets, and the dominance of international investors in determining share prices.

Australia's GST Methodology has its Supporters, but also Detractors

Recently, the Economic Society of Australia polled 49 prominent Australian economists on the issue of GST reform.

They asked each member of the panel whether they agreed with the following statement:

Increasing government revenue collected through the Goods and Services Tax (GST) by removing exemptions (such as food, health, and education) is better than achieving the same extra revenue by increasing the GST rate while retaining the existing exemptions.

The U.K. Government Crack Down on Tax Avoidance...Not So Much

Corporate tax policy says more about power than anything else does. Corporations seek to minimise the tax they pay – and, while governments ordinarily try to maximise their revenues, in the case of transnational corporations (TNCs) they understand that they have to tread carefully. Governments have come to accept that they hold fewer and fewer cards as capital has become more mobile.

Tax Havens are Safe from the OECD for Now

The news has been full of stories about how companies such as Amazon, Apple, Google, Microsoft, Starbucks and others are able to shift their profits to low or no-tax jurisdictions by using novel, legally permitted corporate structures and complex internal transactions (known as transfer pricing schemes). Companies are able to do so because they pay taxes at the place of their residence rather than where the underlying economic activity takes place.