Tag Archives | Taxes

Mitt Romney Would Pay 0.82 Percent In Taxes Under Paul Ryan’s Plan

Commentators have wondered whether the pick of the economically extreme Ryan as a running mate was an error in calculation, but it seems quite pragmatic to me — should Romney win the presidency, and be succeeded by Ryan, Mitt may end up effectively never having to pay taxes again. The Atlantic crunched the figures:

Under Paul Ryan’s plan, Mitt Romney wouldn’t pay any taxes for the next ten years — or any of the years after that. Now, do I know that that’s true. Yes, I’m certain.

Well, maybe not quite nothing. In 2010 — the only year we have seen a full return from him — Romney would have paid an effective tax rate of around 0.82 percent under the Ryan plan, rather than the 13.9 percent he actually did. How would someone with more than $21 million in taxable income pay so little? Well, the vast majority of Romney’s income came from capital gains, interest, and dividends.

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The Rich Have Hidden $21 Trillion In Global Tax Havens

Wealth inequality between the super-rich and everyone else has been vastly underestimated, the Guardian reports:

The world’s super-rich have taken advantage of lax tax rules to siphon off at least $21 trillion, and possibly as much as $32tn, from their home countries and hide it abroad – a sum larger than the entire American economy.

James Henry, a former chief economist at consultancy McKinsey and an expert on tax havens, has conducted groundbreaking new research for the Tax Justice Network campaign group – sifting through data from the Bank for International Settlements (BIS), the International Monetary Fund (IMF) and private sector analysts to construct an alarming picture that shows capital flooding out of countries across the world and disappearing into the cracks in the financial system.

“These estimates reveal a staggering failure,” says John Christensen of the Tax Justice Network. “Inequality is much, much worse than official statistics show, but politicians are still relying on trickle-down to transfer wealth to poorer people.

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Lauryn Hill Versus The Military-Industrial Complex

Lauryn Hill. Photo: Lisa Liang (CC)

Well what do you think, will Lauryn Hill fare better against the tax evasion charges she faces than Wesley Snipes did? Ms. Hill explains her position on her Tumblr:

For the past several years, I have remained what others would consider underground. I did this in order to build a community of people, like-minded in their desire for freedom and the right to pursue their goals and lives without being manipulated and controlled by a media protected military industrial complex with a completely different agenda. Having put the lives and needs of other people before my own for multiple years, and having made hundreds of millions of dollars for certain institutions, under complex and sometimes severe circumstances, I began to require growth and more equitable treatment, but was met with resistance. I entered into my craft full of optimism (which I still possess), but immediately saw the suppressive force with which the system attempts to maintain it’s control over a given paradigm.

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Identity Thieves Scamming U.S. Government With Fake Tax Refund Claims

identity theftIngeniously devious and glaringly simple. Lizette Alvarez reports on the latest ID theft scam for the New York Times:

Besieged by identity theft, Florida now faces a fast-spreading form of fraud so simple and lucrative that some violent criminals have traded their guns for laptops. And the target is the United States Treasury.

With nothing more than ledgers of stolen identity information — Social Security numbers and their corresponding names and birth dates — criminals have electronically filed thousands of false tax returns with made-up incomes and withholding information and have received hundreds of millions of dollars in wrongful refunds, law enforcement officials say.

The criminals, some of them former drug dealers, outwit the Internal Revenue Service by filing a return before the legitimate taxpayer files. Then the criminals receive the refund, sometimes by check but more often though a convenient but hard-to-trace prepaid debit card.

The government-approved cards, intended to help people who have no bank accounts, are widely available in many places, including tax preparation companies.

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Why Are So Many People Renouncing United States Citizenship?

241px-United_States_penny,_obverse,_2002There’s been a massive amount of fretting over the ethics of Facebook co-founder Eduardo Saverin’s renunciation of his U.S. citizenship (which the Brazilian native gained roughly 15 years ago).

Various scandalized headlines have mentioned that he’s just one of 1,800 other Americans to give up citizenship last year, up from 235 in 2008, while others have speculated that it’s a cynical move to avoid taxes resulting from a massive capital gain when Facebook shares become publicly traded. Saverin has been savaged in the media and on the social web, but in fact it turns out that this cannot be a tax-saving move. Any ideas as to why Saverin and the other ex-Americans gave up the benefits of Uncle Sam’s protections?

Tom Worstall explains why Saverin will actually owe more taxes in Forbes:

Eduardo Saverin, one of the founders and major shareholders in Facebook, has renounced his US citizenship just before the company’s IPO.

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Legalizing Pot Would Raise More Revenue Than Buffett Rule

Medical-marijuana-signPhilip Klein makes a good economic case for legalization of marijuana, writing for the Washington Examiner:

Over the past week, President Obama spent time promoting the Buffett Rule surtax on millionaires and paid a visit to Colombia in which he reiterated his opposition to legalizing drugs. Though the two issues were unrelated, it’s worth remarking that legalizing drugs would actually do more to reduce deficits than implementing the Buffett Rule.

The Buffett tax, which failed to advance in the Senate last night, would have raised $5.1 billion in 2013 (theoretically its first full year of implementation), according to the Joint Committee on Taxation. Yet a 2010 study by the libertarian Cato Institute found that legalizing marijuana alone would save the federal government $3.3 billion in reduced enforcement expenditures per year and raise an additional $5.8 billion in revenue assuming it would be taxed. If all drugs were legalized, the study estimated it would save the federal government $15.6 billion a year and raise an additional $31.2 billion in revenue — for a total of $46.8 billion.

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Why Booze Is Barely Taxed

Photo: Clock (CC)

Photo: Clock (CC)

Now you might think that’s a crazy headline, but as Frank Bruni points out in the New York Times, “Congress last revised excise taxes on distilled spirits in 1991, [and] the real value of those taxes has declined more than 35 percent”! (Disinfonauts outside the US, let us know how alcohol is taxed in your country)

… excise taxes on alcohol have gone down over the last few decades, when adjusted for inflation and measured in terms of the percentage they represent of the wholesale and retail price of a bottle or a can. The federal government and many states long ago set those levies in terms of a certain dollar amount per gallon — and then didn’t tweak them much as the cost of living went up.

Because Congress last revised excise taxes on distilled spirits in 1991, the real value of those taxes has declined more than 35 percent, said Alexander Wagenaar, a professor at the University of Florida’s College of Medicine who specializes in alcohol research.

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Seven Big Economic Lies

Do tax cuts for the rich trickle down to the rest of us? And does taxing the rich hurt the economy? Is Social security a Ponzi scheme? Robert Reich, Secretary of Labor under President Bill Clinton, presents his list of seven popular-wisdom economic claims that are untrue. Feel free to debate.

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Large US Corporations Have Tax Rates As Low As -58%

Day 12 Occupy Wall Street September 28 2011 Shankbone 30And the media wonders why the 99% are angry? From MarketWatch:

The official federal corporate income tax rate in the U.S. is 35%, but plenty of the nation’s largest publicly traded companies are paying no taxes — even getting money back from the government in some cases — in years when they reap big profits, according to a new report.

Thirty of the 280 Fortune 500 companies studied paid zero in federal income taxes or enjoyed tax rebates in 2008, 2009 and 2010, according to the study by the left-leaning Citizens for Tax Justice, a Washington-based nonprofit research and advocacy group, and the Institute on Taxation and Economic Policy, a nonprofit, nonpartisan research group.

And 78 of the 280 companies paid nothing in federal income taxes or enjoyed a tax rebate in at least one of those years. Those 78 companies, including General Electric Co. (NYSE:GE) and Pepco Holdings Inc.

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