The past week has been nearly nonstop with news on various fronts of a dispute over taxation of digital businesses. The main characters have been the U.S., France, and the UK, although the EU and the OECD have also played roles. Though the dust is still settling, it is worth trying to tie the various
Since the 2008 financial crisis, financial transaction taxes (FTTs) have been debated as a potential instrument to address financial market instabilities and as a source for tax revenue. Today’s map shows which European OECD countries impose a type of FTT. FTTs are levied on the trade in financial instruments such as stocks, bonds, or derivatives.
Key Findings: The American nicotine market is developing faster than ever due to introduction of non-combustible recreational nicotine products. These new products, along with a greater consciousness about the dangers of smoking, have prompted millions to give up smoking. This contributed to federal and state excise tax collections on tobacco products declining since 2010. Excise
In France, Controlled Foreign Corporation (CFC) rules were first enacted in 1980. The French tax regime operates on a strict territorial basis, where only profits generated in the country are subject to tax in France. Shareholding requirement for the control determination in France The control threshold for CFC purposes is set at 50 percent of
Under a territorial tax system, international businesses pay taxes to the countries in which they are located and earn their income. This means that territorial tax regimes do not generally tax the income companies earn in foreign countries. A worldwide tax system, on the other hand—such as the system previously employed by the United States—requires
Building on tax reforms adopted in 2018, Iowa Gov. Kim Reynolds (R) is proposing additional reforms which expand and guarantee the promises of the 2018 legislation while modestly rebalancing tax collections between income and consumption. Were these proposed reforms in effect today, Iowa would rank 37th overall on our State Business Tax Climate Index, an
The Chinese Controlled Foreign Corporation (CFC) regime was adopted in 2008. CFC rules in China are not commonly enforced, and the government relies more on the application of transfer pricing rules than other general anti-avoidance methods. The rules were created to prevent Chinese multinationals from leaving profits in low-tax jurisdictions through arrangements without business substance.
Pets do more than warm our hearts; they’re road trip buddies, winter lap warmers, and sometimes — legitimate treatments for medical conditions. According to the IRS, if you have a service animal “primarily for medical care to alleviate a mental defect or illness,” and can establish that your companion qualifies, you could claim their expenses
More than 140 countries worldwide—including all European countries—levy a Value-Added Tax (VAT) on purchases for consumption. As today’s tax map shows, although harmonized to some extent by the European Union (EU), EU member states’ VAT rates vary across countries. The VAT is a consumption tax assessed on the value added to goods and services. The
Last week, Austria’s newly formed government consisting of the Austrian People’s Party and the Greens released its government program, putting tax reform once again on the agenda after the collapse of the previous government. The two overarching goals are to lower the overall tax burden and to align the tax system with environmental priorities. Many
Gamblers understand the concept of win some, lose some. But the IRS? It prefers exact numbers. Specifically, your tax return should reflect your total year’s gambling winnings – from the big blackjack score to the smaller fantasy football payout. That’s because you’re required to report each stroke of luck as taxable income — big or
Key Findings Full expensing recognizes two key concepts left unaddressed by depreciation deductions: opportunity cost and the time value of money. Immediately deducting the cost of investments aligns the cash flow of a business with the way businesses, make investment decisions, and with opportunity costs and the time value of money. Depreciation understates business costs,
We all want to get every last one of our hard-earned dimes back from the IRS. Fortunately, working with TaxAct® means you don’t need a master’s degree in accounting to put the figures in your favor. Knowing how deductions and credits affect your situation puts you in a position to file confidently, and when it
Key Findings State tax changes are not made in a vacuum. States often adopt policies after watching peers address similar issues. Several notable trends in tax policy have emerged across states in recent years, and policymakers can benefit from taking note of these developments. The enactment of the federal Tax Cuts and Jobs Act (TCJA)
If you earn income transporting strangers from Point A to Point B, chances are you’re already aware of the most common tax deductions for rideshare drivers: mileage on your car, filling your tank with gas, insurance, etc. But let’s talk about the side hustle savings you could be missing — just in time for filing
Your Happy Hunting Could Save You Hundreds That title smells like clickbait. But we promise deer deductions are a real thing. We also promise that the recent film star around the office, our very own deer, is happy, healthy, and raiding the fridge come lunch time. Fact: Some taxpayers receive credits for deer donations.
In a few days, people around the world will celebrate the turn of a decade, with many opening a bottle of sparkling wine to wish farewell to 2019 and offer a warm welcome to 2020. How such a bottle of sparkling wine is taxed differs significantly across EU countries, ranging from no excise tax in
The 2007-2008 financial crisis triggered a global debate on whether, and if so how, taxation can be used as an instrument to stabilize the financial sector and to generate revenue to partially cover the costs associated with the recent and potential future crises. Three approaches were mainly discussed, namely financial stability contributions (levied on financial
Key Findings Several politicians have suggested eliminating deferral of capital gains (appreciation in an asset’s price over original purchase price) via a mark-to-market system as one way to generate revenue in a progressive manner and reduce inequality. A mark-to-market system would tax accrued gains on assets annually and eliminate the deferral advantage of the current
Germany ranks 16th on the Tax Foundation’s 2019 International Tax Competitiveness Index, a study that measures and compares how well OECD countries promote sustainable economic growth and investment through competitive and neutral tax systems. With Germany having seen few major changes to its tax system over the last years, this ranking has been relatively stable.