The Foreign Account Tax Compliance Act: The Solution Or The Problem?, 2016 Claremont McKenna College
The Foreign Account Tax Compliance Act: The Solution Or The Problem?, Sophie S. Chou
CMC Senior Theses
Tax evasion has been happening for decades, but after the highly publicized cases with two foreign banks, LGT and UBS, the United States (US) is cracking down on tax evaders. The latest addition to the Internal Revenue Service (IRS)’s repertoire of enforcement tools is the Foreign Account Tax Compliance Act, otherwise known as FATCA. The Act was enacted to incentivize tax information release by foreign financial institutions (FFIs) who would otherwise face a 30% withholding tax on any US source income. The question was whether or not the design of the Act and its implementation successfully met this goal.
This …
Marital Sharing Of Transfer Tax Exemptions, 2016 Saint Louis University School of Law
Marital Sharing Of Transfer Tax Exemptions, Kerry A. Ryan
All Faculty Scholarship
This Article analyzes portability and its antecedents in order to distill a positive account of marital sharing oftransfer tax exemption amounts. Prior to 2010, the estate and gift tax exemption equivalent was a nontransferable, separate tax attribute of each spouse. A spouse could only access his or her spouse’s effective exemption by shifting property into the other spouse’s tax base. With the enactment of portability, Congress decoupled tax-free availability of a spouse’s unified credit from the necessity of a prior intra-spousal transfer. All that is required is an election by the decedent spouse, via the executor, to share the decedent’s …
The Economics Of The Political Parties: A Comparison Of Economic Performance Under Conservatives And Liberals, 2016 Olivet Nazarene University
The Economics Of The Political Parties: A Comparison Of Economic Performance Under Conservatives And Liberals, Austin Fischer
Honors Program Projects
A topic that has long been a subject of debate is which party in America’s two-party political system has better economic policies. Democrats tout strong economic records, boasting of their tried and true Keynesian principles. Republicans point to the accomplishments of recent presidents in combating recessions with supply-side ideals. This project attempts to look at the actual performance of the economy under Republican and Democratic presidents since 1950, and come to an unbiased conclusion on whose policies really do work better.
This project looks at GDP growth, inflation, unemployment, disposable income, and budget deficits to determine which party’s policies help …
Between Scylla And Charybdis: Taxing Corporations Or Shareholders (Or Both), 2016 Columbia Law School
Between Scylla And Charybdis: Taxing Corporations Or Shareholders (Or Both), David M. Schizer
Faculty Scholarship
The United States taxes both corporations and shareholders on corporate profits. In principle, the United States could rely on only one of these taxes, as many commentators have suggested. Although choosing to tax the corporation or its owners may seem like taking money from one pocket or the other, this Essay emphasizes a key difference: These taxes prompt different planning. Relying on one or the other mitigates some distortions and leaks, while exacerbating others. As a result, choosing which to impose is like navigating between Scylla and Charybdis.
In response, this Essay recommends using both taxes for three reasons. First, …
"Death Tax" Politics, 2016 Columbia Law School
"Death Tax" Politics, Michael J. Graetz
Faculty Scholarship
In his Keynote Address "Death Tax" Politics at the October 2, 2015 Boston College Law School and American College of Trust and Estate Counsel Symposium, The Centennial of the Estate and Gift Tax: Perspectives and Recommendations, Michael Graetz describes the fight over the repeal of the estate tax and its current diminished state. Graetz argues that the political battle over the repeal of the estate tax reflects a fundamental challenge to our nation's progressive tax system. This Address concludes that a revitalized estate tax is important for managing the national debt and reducing massive inequalities in wealth.
Unilateral Responses To Tax Treaty Abuse: A Functional Approach, 2016 University of Florida Levin College of Law
Unilateral Responses To Tax Treaty Abuse: A Functional Approach, Omri Y. Marian
UF Law Faculty Publications
Recent years have seen a dramatic increase in the attention given to abusive tax schemes that take advantage of bilateral tax treaties. The ensuing discourse tends to view potential responses to treaty abuses as a hierarchical set of options, gradually escalating, in which treaty termination is a last resort option. This article argues that the hierarchical view of unilateral responses to treaty abuse is misguided. Unilateral responses to treaty-based abuse are not hierarchically ordered. Rather, the approach to treaty abuse is (and should be) functional, adopting specific types of unilateral responses based on the type of treaty abuse at issue. …
Bringing International Tax Policy Into The 21st Century, 2016 Columbia Law School
Bringing International Tax Policy Into The 21st Century, Michael J. Graetz
Faculty Scholarship
Michael J. Graetz delivered the following remarks at the Tax Policy Center's "A Corporate Tax for the 21st Century" conference on July 14 in Washington. These remarks are substantially taken from his April 2015 Ross Parsons Lecture at the University of Sydney Law School.
Integration Of Corporate And Shareholder Taxes, 2016 Columbia Law School
Integration Of Corporate And Shareholder Taxes, Michael J. Graetz, Alvin C. Warren
Faculty Scholarship
Integration of the corporate and individual income taxes can be achieved by providing shareholders a credit for corporate taxes paid with respect to corporate earnings distributed as dividends. When such integration was previously considered in the U.S., proponents emphasized that it could reduce or eliminate many of the familiar distortions of a classical corporate income tax. Integration would also provide a framework for addressing current concerns for tax incentives for U.S. companies to shift income to foreign affiliates in lower-taxed countries or to expatriate in "inversion" transactions. A recent Congressional proposal for a corporate dividend deduction coupled with withholding on …
Reconsidering The Tax Treaty, 2016 Boston University School of Law
Reconsidering The Tax Treaty, Steven Dean, Rebecca M. Kysar
Faculty Scholarship
For nearly one hundred years, the international tax regime steadfastly pursued a single nemesis, double taxation. States armed themselves against this common enemy with their weapon of choice, the double tax treaty. Nearly uniform in language and approach, the treaties proliferated to more than three thousand in number,1 resulting in a secure arrangement between and among states and taxpayers.
Yet in recent years, states have had to expand the war to multiple fronts in the face of globalization, technological changes, evolving taxpayer abuses, and shifts in both domestic and international political pressures. For instance, a growing recognition that the …
Branding Taxation, 2016 University of Washington School of Law
Branding Taxation, Xuan-Thao Nguyen, Jeffrey A. Maine
Articles
Branding is important not only to businesses,but also to the economy. The intellectual property laws and tax laws should thus further the legitimate goals of encouraging and protecting brand investments while maintaining a sound tax base. Intellectual property protections for branding depend on advertisement and enforcement, both of which demand significant amounts of private investment by firms. Although one would expect similar tax treatments of both categories of investment, the categories are actually treated as vastly different for federal income tax purposes. Additionally, tax distinctions also exist within each category. The result is that some branding investments are expensed and …
Cross-Deductions In The Net Investment Income Tax Imposed On A Trust Or Estate With Separate Shares, 2016 California Western School of Law
Cross-Deductions In The Net Investment Income Tax Imposed On A Trust Or Estate With Separate Shares, Michael T. Yu
Faculty Scholarship
Part I of this article first provides a general overview of §§ 1411 and 663(c) and the interaction between them and the respective regulations thereunder and then proposes a revised regulation to clarify the relationship between and among the two sections and their regulations. Part II discusses the possibility of certain cross-deductions under § 1411, in conjunction with §§ 661, 662, and 663(c). Finally, Part III presents and discusses a proposed calculation and allocation, to the separate shares of a trust or estate, of income and deduction items entering into the computation of NII and DNI of the trust or …
Evaluating Beps: A Reconsideration Of The Benefits Principle And Proposal For Un Oversight, 2016 University of Michigan Law School
Evaluating Beps: A Reconsideration Of The Benefits Principle And Proposal For Un Oversight, Reuven Avi-Yonah, Haiyan Xu
Articles
The Financial Crisis of 2008 and Great Recession that followed have exacerbated income inequality within and between countries. In the aftermath of the economic turbulence, politicians have turned their attention to the twin problems of individual tax evasion and corporate tax avoidance. U.S. legislators enacted the Foreign Account Tax Compliance Act (FACTA), leading to the United States signing a series of Intergovernmental Agreements (IGAs) for the exchange of tax information. The Organization for Economic Co-operation and Development (OECD) developed the Multilateral Agreement for Administrative Assistance in Tax Matters (MAATM) and initiated the Base Erosion and Profit Shifting (BEPS) project to …
Provisions Denying A Deduction For Illegal Expenses And Expenses Of An Illegal Business Should Be Repealed, 2016 University of Michigan Law School
Provisions Denying A Deduction For Illegal Expenses And Expenses Of An Illegal Business Should Be Repealed, Douglas A. Kahn, Howard Bromberg
Articles
Currently, the tax law denies a deduction for business expenses that violate a federal or state law (but only if the state law is generally enforced). In addition, losses, including business losses, cannot be deducted if they arise out of an illegal activity. For example, medical expenses are denied a deduction if they are illegal. Kickbacks, bribes, and rebates given in connection with the Medicaid or Medicare program are nondeductible. Any expenses, legal or not, incurred in connection with the conduct of a business of selling a controlled substance that is prohibited by federal law (or by the law of …
Six Degrees Of Graduation: Law And Economics Of Variable Sanctions, 2016 Columbia Law School
Six Degrees Of Graduation: Law And Economics Of Variable Sanctions, Alex Raskolnikov
Faculty Scholarship
From parking tickets to tax fines and punitive damages, legal sanctions matter in people's lives. Yet neither the legal nor the economics literature offers a comprehensive treatment of sanctions. Their practical complexity is not well understood, and their theoretical analysis is fragmented. This Essay addresses both limitations using tax law as a primary example. Sanctions are complex because they vary along at least six different dimensions: aggressiveness, magnitude, culpability, effort to comply, likelihood of detection, and offense history. These six degrees of sanction graduation are distinct, and potentially independent, but often intertwined in obscure and perplexing ways. After clarifying the …
Tax Cannibalization And State Government Tax Incentive Programs, 2016 Indiana University Maurer School of Law
Tax Cannibalization And State Government Tax Incentive Programs, David Gamage, Darien Shanske
Articles by Maurer Faculty
States and localities offer businesses an enormous amount of tax incentives to locate within their jurisdictions despite: 1) the mass of evidence that suggests that these incentives are not particularly effective and, 2) substantial doubts about their constitutionality.
In this essay, we develop a new critical perspective on state tax incentives. We argue that offering these incentives permits states to offer lower taxes to more mobile businesses while keeping their overall corporate tax rates high. This is arguably not the best choice for the states, but it is definitely not the best choice for the federal government. Because the states …
Using Taxes To Improve Cap And Trade, Part Ii: Efficient Pricing, 2016 Indiana University Maurer School of Law
Using Taxes To Improve Cap And Trade, Part Ii: Efficient Pricing, David Gamage, Darien Shanske
Articles by Maurer Faculty
In this article, the first of a series, we analyze the distributional issues involved in implementing U.S. state level cap-and-trade regimes. Specifically, we will argue that the structure of California’s AB 32 regime will unnecessarily disadvantage lower-income Californians under the announced plan to give away approximately half of the permits to businesses and pollution-emitting entities.
The Federal Government's Power To Restrict State Taxation, 2016 Indiana University Maurer School of Law
The Federal Government's Power To Restrict State Taxation, David Gamage, Darien Shanske
Articles by Maurer Faculty
This essay evaluates the limits on the U.S. federal government’s powers to restrict the taxing powers of state governments. The essay revisits earlier debates on this question, to consider the implications of the Supreme Court’s decision in National Federation of Independent Business v. Sebelius and also academic research on the problem of tax cannibalization.
Implementation Of Arbitration Decisions In Domestic Law, 2016 Osgoode Hall Law School of York University
Implementation Of Arbitration Decisions In Domestic Law, J. Scott Wilkie
Articles & Book Chapters
Arbitration, even if it seems simply providing for the possibility of arbitration, is increasingly attracting attention as a possible means to discipline the resolution of otherwise potentially intractable international tax controversies concerning the allocation of taxing rights under tax treaties.While perceived, though not without reservation, to be a potential welcome addition to a typical mutual agreement procedure (MAP) patterned on article 25 (“the MAP article”) of the OECD Model Tax Convention on Income and Capital(“the OECD Model”) in the form of article 25(5), other provisions of article 25, notably its “interpretive” and “application,”and “legislative”,aspects and contemplated recourse to a “joint …
International Taxation In China : A Contextual Analysis, 2016 Osgoode Hall Law School of York University
International Taxation In China : A Contextual Analysis, Jinyan Li
Books
Chinese tax law affects corporations engaged in cross-border transactions with China. It may also impact the development of the international tax regime as China is increasingly engaged in international tax reform efforts, such as the G20/OECD BEPS Project. Chinese tax law is thus important to taxpayers, tax professionals and policymakers worldwide. However, it is a challenge to find comprehensive information and insightful analysis of Chinese tax law in English. International Taxation in China: A Contextualized Analysis meets that challenge. This book deals with the Chinese international tax regime, focusing on the enterprise income tax and tax treaties. First, it covers …
Alternatives To The Gift And Estate Tax, 2016 Allard School of Law at the University of British Columbia
Alternatives To The Gift And Estate Tax, David G. Duff
All Faculty Publications
Following the near death experience of the federal gift and estate tax in 2010, the hundredth anniversary of the tax represents an ideal moment to reflect on the role of this tax and whether an alternative approach might be more desirable and sustainable. This Article examines four prominent alternatives to the current tax: an annual wealth tax, taxing unrealized gains at death, including gifts and inheritances in income, and a lifetime accessions tax that would apply to the cumulative value of gifts and inheritances received by individuals over their lifetimes. In order to assess these alternatives, the Article reconsiders the …