Taxing Digital Is Hard, Former State Tax Chief Says
Talking Tax
by Bloomberg Tax
12h ago
For more than a decade, states have had to grapple with the challenge of taxing the digital economy. Peering into cyberspace, tax administrators were often left with more questions than answers. What online products and services should be taxed? How does a state source a virtual creation to a specific jurisdiction? Can states even tax digital products and services in the face of federal limits on discriminatory taxes on electronic commerce? State tax authorities now have to answer these questions without Gil Brewer, who retired at the end of January from his position as assistant director of t ..read more
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Multinationals Shoot Ads With State Film Tax Credits
Talking Tax
by Bloomberg Tax
1w ago
State film tax credit programs are increasingly financing advertisements for some of the world’s largest consumer product companies, some of which subsequently sell the credits to other companies looking to reduce their state tax liabilities. Twenty-eight states and Puerto Rico allow such incentives for production of commercials. Major companies, including McDonald’s Corp., Kellanova, and AbbVie Inc., receive these to promote products such as burgers, cereal, and prescription drugs. Tax credits are sometimes obtained by ad agencies or production companies, while in other cases the brands obtai ..read more
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Here's What to Know as Tax Filing Season Kicks Off
Talking Tax
by Bloomberg Tax
2w ago
More than 146 million individual tax returns are expected to be filed before the end of the 2024 tax filing season. The IRS, with the help of the tens of billions of dollars in supplemental cash from the Democrats' 2022 tax-and-climate law, built up its call centers, expanded its online options, and is now offering more hours at its taxpayer assistance centers to help make a smoother tax filing season for taxpayers and tax professionals. It also launched a controversial free agency-run filing tool for low- and moderate-income taxpayers filing simple returns, though access to the tool won't be ..read more
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States Eye Worldwide Reporting to Curb Income Shifting
Talking Tax
by Bloomberg Tax
2w ago
For decades, states’ authorities to tax the earnings of multinational corporations have ended abruptly at the “water’s edge.” Frustration with this limitation, however, has grown in recent years as large, sophisticated businesses employ accounting techniques and asset transactions to shift their domestic earnings offshore. Mandatory worldwide combined reporting—an apportionment method requiring the calculation of taxes based on global income attributable to a particular jurisdiction—is one possible solution gaining attention in state capitals. Lawmakers in Minnesota came close to enacting a wo ..read more
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States Eye Worldwide Reporting to Curb Income Shifting
Talking Tax
by Bloomberg Tax
3w ago
For decades, states’ authorities to tax the earnings of multinational corporations have ended abruptly at the “water’s edge.” Frustration with this limitation, however, has grown in recent years as large, sophisticated businesses employ accounting techniques and asset transactions to shift their domestic earnings offshore. Mandatory worldwide combined reporting—an apportionment method requiring the calculation of taxes based on global income attributable to a particular jurisdiction—is one possible solution gaining attention in state capitals. Lawmakers in Minnesota came close to enacting a wo ..read more
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Ex-Treasury Official Plowgian Talks OECD Deal's Future
Talking Tax
by Bloomberg Tax
1M ago
Michael Plowgian, who in December left his role as deputy assistant secretary for international affairs at the Treasury Department, had an eventful stint at the department. The former top OECD negotiator for the US started at Treasury in October 2021 as a counselor right around the time over 140 countries agreed to the global tax deal. Since then, Plowgian has been a part of large steps in the deal's progression—from tranches of Pillar Two rules to the release of a draft multilateral treaty text that would reallocate large multinational companies' residual profits to market jurisdictions. The ..read more
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Fate of Latest Tax Proposal Is Far From Certain
Talking Tax
by Bloomberg Tax
1M ago
Leaders of the House and Senate tax-writing committees unveiled a bipartisan framework this week that pairs business breaks with an expansion of the child tax credit, but a path toward passage remains rocky. Despite having the blessing of Senate Finance Chair Ron Wyden (D-Ore.) and Ways and Means Chair Jason Smith (R-Mo.), the panels' ranking members aren't yet sold. And while the framework has support from Senate Majority Leader Charles Schumer (D-N.Y.), it's not certain whether Speaker Mike Johnson (R-La.) will back the deal, too. The agreement—paid for by ending the troubled employee retent ..read more
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A Look at the US-Taiwan Tax Pact and What Happens Next
Talking Tax
by Bloomberg Tax
1M ago
In a Congress where lawmakers are divided on an overwhelming set of issues, helping to alleviate double taxation for businesses operating in both the US and Taiwan is one with rare bipartisan unity. House Ways and Means Committee members voted in unison to send a bill to the House floor aimed at providing treaty-like benefits to the island democracy. Leaders of both the House and Senate tax-writing committees gave the bill their bipartisan blessing and say they're pushing for speedy passage. A way to provide tax benefits to Taipei without angering China is seen as integral to the US goal of bo ..read more
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Business Leader Talks OECD Tax Deal and Its Impact
Talking Tax
by Bloomberg Tax
1M ago
Over the past six months, the OECD has released multiple documents with more details on parts of the international tax deal agreed to by over 140 countries in 2021. But even with the additional clarity from the Organization for Economic Cooperation and Development, there are still fundamental questions about key parts of the deal—such as a simplified transfer pricing method, known as Amount B—that remain. The tax agreement comprises two parts: a reallocation of large multinationals' residual profits, known as Pillar One, and a 15% global minimum tax, known as Pillar Two. Alan McLean, chair of ..read more
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Union Head Talks IRS Hiring Push, Possible Shutdown
Talking Tax
by Bloomberg Tax
2M ago
The union that represents about 65,000 IRS employees is teaming up with the agency to help attract new talent amid a hiring spree. The Democrats' tax-and-climate law gave the IRS tens of billions to dollars to modernize and go after taxpayers who haven't been paying what they owe. To do that, the IRS needs to build up its workforce, but it is competing with the more-lucrative private sector. That's where the National Treasury Employees Union is stepping in. Bloomberg Tax reporter Erin Slowey spoke with NTEU National President Doreen Greenwald about what the union is doing to negotiate benefits ..read more
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