Remember a few days ago when we were discussing a possible fiscal cliff deal that Obama might or might not go for? Well, Speaker of the House John Boehner discovered that his republicans would not support the tax increases on the those earning more than $400,000, the increase in capital gains and dividends taxes, and the cap on deductions at 28% of income. So Boehner abandoned that arrangement–it’s dead. Instead, Boehner proposed something called “Plan B”. (British readers are familiar with a different Plan B that proposes a stimulus alternative to their coalition government’s austerity policy; this is not that.) Plan B was substantially more favourable to the republican position, but nonetheless, the republicans in the house refused to support it, and now it is dead too. So where does this leave us in our struggle to avoid the fiscal cliff, the combination of large spending cuts and tax increases that kick in on January 1st and which the CBO forecasts will lead to a recession in 2013?
Tag: Tax
Fiscal Cliff Ignorance
I’m back in the United States for a month, so it’s only fitting to write an American piece. There’s a statistic out there that should put fear into the hearts of those of us who practise, either professionally or as a hobby, the art of statecraft. The implications of this statistic are vast for the health of the American economy and the American democracy.
How to Stop Tax Avoidance
Recently, as countries have sought to shrink deficits, the question of tax avoidance has come up, and how to put a stop to it. In Britain, Google, Amazon, and Starbucks are being questioned by parliament as to why they pay such small amounts of tax on their UK incomes. Much of the public is in uproar over the fact that Google, Amazon, and Starbucks paid effective tax rates of 0.4%, 2.5%, and 0% on their respective 2011 earnings. All of this begs one very important question, one that no one seems to be attempting to answer seriously–what do we do about this? How do we stop it?
Fiscal Cliff Insanity
Back in August, I wrote a piece called “Fiscal Cliff Madness” about the set of consequences produced by the law enacted by the government that will severely reduce spending and raise taxes. Today, new research has surfaced from the non-partisan Congressional Budget Office (CBO) that gives us a clearer idea of just what exactly the fiscal cliff might do to the United States’ economy if it comes to pass. The new information is even more dire than the information we had in August, and so the “madness” has now been upgraded to “insanity”.
The TV Licence Gestapo
It’s that time again–no, not for the wheel of morality, but for the British government’s annual welcoming of students back to university. Is it a reduction in tuition fees? A care package full of sweets? An expression of thanks to the international students for helping to keep tuition costs down for everyone else? None of these things. It’s a friendly letter from the TV Licencing Authority. Two friendly letters, in fact, which I received this year on the very same day. One is from September, which happens to be before term started, and it informs me of the British practise of TV licencing–the requirement that all people in the UK who watch live television purchase a TV licence, the proceeds of which goes to fund the BBC. The other, apparently from this month, tells me that last month I received a letter and took no action, and that consequently I am now under “investigation”, an investigation which “could lead to a summons, a court hearing, or a fine of up to 1,000 pounds plus legal costs”. I am unfazed by this–at the start of each academic year, the TV Licencing Authority threatens me (and everyone else at the university who hasn’t bought a TV license) with an investigation. Every year I inform them that I do not require a licence (I do not own a TV in Britain and watch no live television on my laptop), every year they tell me they may stop by to ensure that I’m not lying, and every year they don’t actually bother to do that. This is not a very pleasant way of interacting with HM Government, to be accused of trying to steal British television right off the plane. In my home country, the United States, we don’t bother with TV licences at all, and so I always find myself reacting to these letters with the thought that well, this is a sort of stupid way to fund the BBC–surely there is a superior alternative? I propose that there is indeed a much more sensible way to do it that does not involve falsely accusing piles and piles of people of fraud, and that proposal follows.
Benjamin Studebaker 