Deferral and Repatriation: A Proposal to Encourage Repatriation of Offshore Income

2013 ◽  
Vol 11 (2) ◽  
pp. 86-101
Author(s):  
William A. Raabe ◽  
Cherie J. Hennig ◽  
John O. Everett
Keyword(s):  
Reward Structure ◽  
Cash Management ◽  
Tax Revenues ◽  
Tax Laws ◽  
Management Plans ◽  
Interest Charge ◽  
Economic Needs ◽  
Tax Benefits ◽  
Subsequent Failure ◽  
The U.S

ABSTRACT The need for U.S. tax laws to encourage and reward repatriation of offshore income is stronger than ever. We propose an approach that will penalize retaining earnings overseas, while rewarding entities that undertake a repatriation policy. The reward structure requires an accountable use of the repatriated funds for designated investments that further the economic needs goals of the U.S. Under our proposal, an interest charge would be assessed on unrepatriated offshore profits and would be reduced as various remission targets are met. The dividends-received deduction on repatriated earnings would increase as various remission and usage targets are met. A clawback provision would require the taxpayer to repay tax benefits received if there is a subsequent failure to meet the usage targets. The potential difficulties of operationalizing our proposal are identified and considered. A combination of the strategies developed in this proposal, perhaps in concert with features of other proposals, would encourage participating corporations to modify their cash management plans in ways that would provide a sustainable boost for the U.S. economy while also increasing tax revenues.

scholarly journals Regulatory Arbitrage in the Intersection of Accounting Standards and Tax Laws: The Case of Synthetic Leases

2020 ◽  
Vol 0 (0) ◽  
Author(s):  
Jan Friedrich
Keyword(s):  
Financial Reporting ◽  
Balance Sheet ◽  
Accounting Standards ◽  
Regulatory Arbitrage ◽  
Regulatory Changes ◽  
Tax Laws ◽  
The Usa ◽  
Tax Benefits ◽  
Sophisticated Instrument ◽  
Us Gaap

AbstractThis paper focuses on the interplay between accounting standards and tax laws in the context of regulatory arbitrage by examining the development of synthetic leases especially in the USA. In a synthetic lease, the lease remains off balance sheet for financial reporting by the lessee, while depreciations and interest expenses can be deducted for tax purposes. Exploring the evolving structures of synthetic leases over the last 30 years, the paper demonstrates how financial engineers have been able to perpetually re-structure this sophisticated instrument to keep it off-balance sheet instrument notwithstanding regulatory changes. Specifically, it shows that the most recent revision of lease accounting standards in 2016 – that intended to mark the end of off-balance sheet leases under IFRS and US-GAAP – resulted in reviving the demand for synthetic leases as the tax benefits outweigh the structuring costs. Contributing to the debate on the shift towards international accounting convergence (including US-GAAP and IFRS), the paper argues that attempts to limit regulatory arbitrage may also consider the reciprocal linkages between accounting standards and tax laws. For instance, tax laws should be considered as a means to limit regulatory arbitrage in financial reporting.

Vacation Homes and Residential Interest Deductions: An Outdated Statute and Conflicting Interpretations Create Confusion (and Planning Opportunities)

2004 ◽  
Vol 2 (1) ◽  
pp. 61-74
Author(s):  
John O. Everett ◽  
William A. Duncan ◽  
Wendy Peffley
Keyword(s):  
Tax Planning ◽  
Second Home ◽  
Tax Effects ◽  
Allocation Method ◽  
Rental Property ◽  
Tax Benefits ◽  
Tax Court ◽  
The U.S ◽  
Allocation Methods

Tax benefits have been the key in making vacation homes affordable for many taxpayers. In some cases these benefits have been augmented by an inconsistency in allocation methods used to determine allowable expenses for vacation homes under Section 280A. The U.S. Tax Court created this inconsistency years ago with its decision in Bolton, 77 TC 104 (1981), where the Court approved an allocation method that was contrary to IRS guidance. Although most analyses since this decision have focused on how the Bolton decision permits a taxpayer to increase total deductions related to a rental property when the Section 280A limits apply, there is another aspect to the allocation controversy that has not received as much attention. Specifically, the possible loss of the personal deduction for residential interest when the property does not qualify as a second home may create unexpected tax consequences, where the best tax-planning advice may be to encourage the taxpayer to use the vacation home for more personal days. This article provides a brief review of the basic Sec. 280A rules for vacation rental homes and closely examines the tax effects of conflicting statutory, administrative, and judicial guidance on the treatment of interest and taxes related to such a property. As demonstrated by three scenarios, the inconsistent treatments may provide an opportunity for owners of vacation homes to “game” the system for maximum tax benefit near the end of a tax year. As a consequence of Congress's failure to update Sec. 280A following the 1986 changes on interest deductions, such gaming of the system may be accomplished without confronting change of accounting method issues.

scholarly journals PROBLEMS OF TAX RISK MANAGEMENT IN THE CONDITIONS OF THE COVID-19 PANDEMIC

2021 ◽  
pp. 188-200
Author(s):  
Anton SHEVCHUK
Keyword(s):  
Economic Crisis ◽  
Business Owners ◽  
The State ◽  
Business Climate ◽  
State Budget ◽  
Political Factors ◽  
Tax Revenues ◽  
The Face ◽  
Tax Benefits ◽  
The Impact

Introduction. The theoretical bases of tax risks are considered and the author's approach to interpretation of their essence is offered. The directions of the COVID-19 pandemic's impact on tax revenues to the State Budget of Ukraine have been studied and the factors of intensification of tax risks have been determined. On this basis, scientifically sound recommendations for improving the management of tax risks in Ukraine in the economic crisis. The purpose of the article is to study the areas of intensification of tax risks in the context of the COVID-19 pandemic and the development of scientifically sound proposals for improving the management of tax risks in the face of new challenges for fiscal authorities. Results. The main directions of the impact of the COVID-19 pandemic on tax revenues to the State Budget of Ukraine are assessed. It is proved that the manifestations of the economic crisis are the main factors of intensification of tax risks in Ukraine, which are expressed in significant losses of budget revenues. Ways to optimize the mechanism of VAT refunds and directions of audit of tax benefits in order to minimize tax risks are proposed. The mechanisms of obligatory fiscalization of micro and small business settlements through the introduction of registrars of settlement operations on favorable terms for business owners without the need to hire additional employees are outlined. Possibilities of realization of the project of electronic customs as one of elements of creation of a positive business climate and minimization of tax risks are considered. Perspectives. Promising areas of research may be the study of psychological, administrative, technological, political factors of tax risks in Ukraine.

scholarly journals Reappraising the Tax Gap

2021 ◽  
pp. 61-74
Author(s):  
Richard Murphy
Keyword(s):  
Government Policy ◽  
Tax System ◽  
Tax Revenues ◽  
Tax Laws ◽  
Tax Gap ◽  
Economic Thinking ◽  
Tax Bases

The tax gap has been described as the amount of tax jurisdictions do not collect, caused by the tax system not being appropriately complied with—in the manner intended by the tax authority—given the current tax laws in operation. That description does, however, ignore the fact that substantial parts of their potential tax revenues are not collected by all governments as a result of their decisions not to tax some tax bases, or because of granted tax allowances, reliefs and exemptions, many of which in turn provide opportunities for tax abuse. This chapter considers the implications of reframing the tax gap to include these tax losses that arise as a result of government policy and suggests the changes in perception, including in macro-economic as well as micro-economic thinking, that might result if this were done. For this, the use of tax spillover analysis is recommended.

scholarly journals The Moonscape of Tax Equality: Windsor and Beyond

2018 ◽  
Author(s):  
Anthony C. Infanti
Keyword(s):  
Same Sex ◽  
Human Relationships ◽  
Same Sex Couples ◽  
Defense Of Marriage Act ◽  
Northwestern University ◽  
Privileged Status ◽  
Tax Laws ◽  
Federal Laws ◽  
Formal Equality ◽  
The U.S

108 Northwestern University Law Review Colloquy 110 (2013)This essay takes a critical look at the tax fallout from the U.S. Supreme Court's decision in United States v. Windsor, which declared section three of the federal Defense of Marriage Act (DOMA) unconstitutional. The essay is important because, while other federal laws will apply to some same-sex couples some of the time, the federal tax laws are a concern for all same-sex couples all of the time. The essay is timely because it addresses the recently issued IRS guidance regarding the tax treatment of same-sex couples. In this essay, I first describe the path that led to the decision in Windsor. Then, I turn to describing the ways in which the post-Windsor tax terrain may actually be worse for same-sex couples than the bleak tax landscape that they faced before that decision. Under DOMA, same-sex couples already faced a debilitating level of uncertainty in determining how the federal tax laws applied to their relationships. Post-Windsor, same-sex couples will see this uncertainty multiply -- even after receiving guidance from the IRS on the implementation of the Windsor decision in the federal tax context. They will have to grapple not only with lingering questions surrounding the federal tax treatment of relationships that are not recognized, but also with new questions regarding whether and how their relationships will be recognized for federal tax purposes. Moreover, it seems that dispatching discrimination designed to erode the progress of same-sex couples toward formal equality has served only to entrench the privileged status of marriage in our federal tax laws rather than fostering the recognition of a broader array of human relationships.

scholarly journals TAX POLICY OF UKRAINE IN CONDITIONS OF ECONOMIC INSTABILITY: ANALYTICAL REVIEW

2020 ◽  
Vol 1 (18(46)) ◽  
pp. 85-89
Author(s):  
Yana Solomka ◽  
Natalia Tydir
Keyword(s):  
Tax Policy ◽  
Tax Incentives ◽  
The State ◽  
Strong Impact ◽  
State Budget ◽  
Tax Revenues ◽  
Analysis And Synthesis ◽  
State Budgets ◽  
Analytical Review ◽  
Tax Benefits

The article examines the main results of the tax policy of Ukraine in 2017-2019. The methodological basis of the study are the fundamental postulates of the liberal theory of effective tax policy, formulated by the famous economists A. Smith, A. Wagner and A. Laffer. The article uses general scientific research methods, in particular, analysis and synthesis, induction and deduction, the unity of the historical and the logical, statistical methods, generalization. The purpose of the article is to find out the state of modern tax policy in Ukraine and further prospects for its development. The tax revenues to the state budgets of different levels are analyzed; their economic importance for the country’s economy is substantiated. It was found that tax revenues make up the largest share (80%) of all state budget revenues and all local budget revenues (61%). The calculation of the coefficient of elasticity of tax revenues in relation to the selected indicators showed that a strong impact on the total amount of tax revenues to the consolidated budget of Ukraine has a change in household incomes and sales of industrial products.The coefficient of efficiency of using tax benefits in Ukraine has been determined. It has been proven that tax incentives are used most effectively in financial and insurance activities, construction, industry, and ineffectively in education and health care. This indicates the advisability of reducing the number and size of tax incentives in these areas.The directions of improving the tax policy of Ukraine are proposed. Among the most important are: socialization of taxes, tax incentives for innovative development and investment climate; introduction of differentiated rates of personal income tax; implementation of the principle of social justice of taxation; the introduction of differentiated rates of the environmental tax depending on the discharge of pollutants in a specific region of the country; an increase in trade quotas for the export of goods to EU countries etc. The research results can be used by the state tax authorities of Ukraine. The novelty of the study lies in the analysis of the effectiveness of the tax policy of Ukraine from the standpoint of its impact on socio-economic development in 2017-2019 based on the author’s research methodology.

Cognitive Responses to Partitioned Pricing of Consumption Taxes: Consequences for State and Local Tax Revenues

2014 ◽  
Vol 37 (1) ◽  
pp. 183-204 ◽  
Author(s):  
Cynthia Blanthorne ◽  
Michael L. Roberts
Keyword(s):  
Data Availability ◽  
Sales Tax ◽  
Cognitive Responses ◽  
Consumer Spending ◽  
Structural Variations ◽  
Excise Tax ◽  
Tax Revenues ◽  
State And Local ◽  
Consumption Taxes ◽  
The U.S

ABSTRACT How do taxpayers respond cognitively to add-on sales taxes versus all-inclusive excise taxes? If structural variations produce cognitive differences, then do the differences affect buying behavior? These are important questions because consumer spending drives the U.S. economy and directly determines the amount of tax revenues collected from consumption taxes. If the negative opinion that people have about taxes (Tax Foundation 2009) increases the saliency of the tax, then an add-on sales tax might decrease consumer spending more than an all-inclusive excise tax pricing structure. Instead, results suggest that demand is higher when the add-on component is a sales tax as compared to an excise tax that is embedded into the total price. The effects on demand are even more pronounced and people recall lower prices when the add-on sales tax is presented as a percentage of the base price—as is generally the case in the U.S.—rather than as an additional currency component. Data Availability: Contact the authors.

Tax reform initiated by D. Trump: Economic and social aspects

2021 ◽  
Vol 27 (3) ◽  
pp. 693-720
Author(s):  
Elena Yu. MAKUSHINA ◽  
Dar'ya M. KARMANOVA ◽  
Aleksei S. KUCHER
Keyword(s):  
United States ◽  
Policy Development ◽  
Tax Reform ◽  
The United States ◽  
Subsequent Increase ◽  
Tax Revenues ◽  
Long Run ◽  
Macroeconomic Indicators ◽  
The Impact ◽  
The U.S

Subject. The article addresses the tax reform of 2017, initiated by D. Trump. Objectives. The aim is to determine the relationship between the total volume of tax revenues to the budget of the U.S. Government and the growth of U.S. GDP in the long run. Methods. To identify the impact of the tax reform on the investment climate in the country and the subsequent GDP growth, we formulate a hypothesis and propose a regression model. The quarterly data from 04.01.1960 to 07.01.2019 serve as a statistical sampling, published by financial departments of the U.S. Office of Management and Budget and the U.S. Bureau of Economic Analysis. The study rests on the econometric analysis enabling to identify the impact of the volume of tax revenues from the corporate income tax and individual income taxes on the level of the GDP of the United States. Results. In the short term, we observe a decrease in tax revenues and a subsequent increase in the budget deficit, in the long term – an increase in business activity of the country, a growth in foreign direct investment, and, consequently, an increase in the GDP. The paper offers a model for assessing the economic growth of the GDP of the United States, in which tax predictors were used in combination with macroeconomic indicators. Conclusions. The experience of the United States and the results of this study may be used by the governments of developing countries and experts in the field of taxation for tax policy development.

Influence of tax preferences on the formation of budget revenues

2014 ◽  
Vol 8 (9) ◽  
pp. 161-170
Author(s):  
Елена Егорова ◽  
Elena Egorova ◽  
Елена Бокарева ◽  
Elena Bokareva
Keyword(s):  
Opposite Effect ◽  
Government Support ◽  
Planning Period ◽  
Tax Base ◽  
Goods And Services ◽  
Tax Revenues ◽  
New Business ◽  
The Russian Federation ◽  
Tax Benefits ◽  
The Government

One of the priorities of economic development is the formation of a stable and sustainable tax system for the Russian Federation for the upcoming planning period, and this means fiscal stability, promoting economic growth in business activity. In the current situation, the main focus of the tax must be made exactly on stimulating component of tax policy in order to ensure stimulation of the economy, as well as business agents to develop production and open new business in Russia. One of the tools of tax incentives are tax preferences. Legislators at the federal level should not make decisions for the regions, the regions should be given a greater autonomy in matters of incentives. In the first place, it is necessary to increase production and sales of competitive goods and services. Only by increasing the production of goods may be increased tax revenues. Today, taxes are considered solely as a means to supplement the budget. The government, seeking to reduce tax benefits, believes that this will contribute to greater density in the budget. But the reduction of tax preferences for the producers will have the opposite effect - a reduction of output and, consequently, a decrease in the output of goods as well as reduced tax revenues. Therefore, in our opinion, it is necessary not to reduce, but to increase government support through tax breaks, subsidies and different preferences, as this would increase the output of goods and, therefore, result in an increase in the tax base and in an increase in tax revenues.

scholarly journals Morbillivirus de los Delfines: Patógeno re-emergente en la población de cetáceos

2014 ◽  
Vol 20 (1) ◽  
pp. 29
Author(s):  
Manuela Echeverri-Zuluaga ◽  
Yeison H. Duque-García ◽  
Julian Ruiz-Saenz
Keyword(s):  
Mediterranean Sea ◽  
Effective Management ◽  
Emerging Infections ◽  
Pilot Whale ◽  
Mesh Terms ◽  
Dolphin Morbillivirus ◽  
Management Plans ◽  
Bibliographic Search ◽  
And Control ◽  
The U.S

Dolphin morbillivirus (DMV) is one of the most important pathogen of cetaceans. It was first described in the late 80s, since has been causing outbreaks that affects dolphin populations and also in other cetaceans in the U.S. and in the Mediterranean sea. We conducted a bibliographic search in MedLine, SciELO, Scopus® and Google Scholar without timeline limits using MeSH terms such as Cetacean morbillivirus, Pilot Whale morbillivirus, Dolphin morbillivirus, Strandings, etc., with the aim of provide a critical update on basic, clinical and epidemiological aspects of one of the most important emerging infections for cetacean wildlife, with particular emphasis on the current alternatives for diagnosis and control. Based on the information gathered we concluded that there is not only a need to study and quantify the strandings, but we need to develop awareness of the importance of this viral infection in cetaceans and to apply effective management plans that maintain those populations in biological balance.

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