tax news

AFP - A Swiss unit of global banking giant HSBC revealed Thursday that details on 24,000 bank customers may have been leaked in a major security breach that has helped fuel pressure on Switzerland over tax evasion.

On CNBC's "Closing Bell" yesterday, Ann Holley of KPMG discusses how so-called "Amazon tax" laws -- which force online retailers such as Amazon.com to collect sales taxes -- could affect state budget deficits. She cites the Tax Foundation's recent report on Amazon taxes, which notes that rather than increasing revenue, these taxes can lead to a revenue drop:

Sponsors have promised that a revenue windfall would follow enactment of an Amazon tax, but no windfalls have been forthcoming so far. This is often because online companies respond to Amazon tax law enactments by ending their affiliate programs. Rhode Island revenue-analysis office head Paul Dion stated in December 2009 that the six-month-old law had collected no revenue. An affiliate trade group believes that Rhode Island has seen less tax revenue come in, because the elimination of the affiliate program reduced income and thus income tax collections. State Treasurer Frank Caprio echoed this, saying, "The affiliate tax has hurt Rhode Island businesses and stifled their growth, as they've been shut out of some of the world's largest marketplaces, and should be repealed immediately."

See the video clip here:

Read Tax Foundation Special Report, No. 176, "'Amazon Tax' Laws Signal Business Unfriendliness and Will Worsen Short-Term Budget Problems."

Idaho may have scored lower in business friendly tax structure than its western neighbors Oregon and Washington in our State Business Tax Climate Index, but trends may change. While Oregon has no sales tax and Washington has no income tax (and not having a major tax is a big advantage, since you lose all the compliance and administrative burden), Oregon has pushed through big income tax increases and Washington State is considering a sales tax increase and a bunch of business tax increases.

Idaho Gov. C.L. "Butch" Otter (R) has jumped in the fray:

Last month, for example, Oregon voters approved their legislature’s decision to raise taxes on the wealthy and on many businesses by $727 million. The immediate result was that my phone started ringing – and so did phones over at our Department of Commerce.[...]

The problem in Oregon is that folks were convinced that state government was what needed to be shored up rather than the jobs- and revenue-producing private sector for which state government is supposed to work. As a result, they’re chasing some of their cash cows to the border. And I welcome those businesses with open arms.

We now are reaching out to hundreds of Oregon businesses, and will do the same with those in Washington if the legislature there follows Oregon’s lead. We aren’t offering many bells and whistles, but what we can offer is a business-friendly State government, a highly qualified and motivated work force, and communities where people understand that while government cannot be the solution to their problems it can and must be a champion for their own solutions.[...]

For those Oregon businesses facing a decision about whether to lay off employees or close their doors entirely, I have a proposal: Move to Idaho. The Tax Foundation rates our corporate tax burden at 17th in the nation, compared to Oregon’s ranking of 31st.   Our individual tax burden is lower, too. Those kinds of numbers can make a real difference to a bottom line.[...]

Gov. Otter notes correctly that Idaho's score on the corporate income tax category of our Index is 17th, beating both Oregon and Washington State.

More on Idaho here.

The $1 cigarette tax hike being proposed by some Georgia lawmakers would push cigarette sales out of state or into the black market, according to a new Tax Foundation report.

Read Tax Foundation Fiscal Fact, No. 215, "Georgia Should Refrain from Relying on Smokers to Fill Budget Hole."

AFP - The US Senate has adopted a 140-billion-dollar raft of measures aimed at shoring up unemployment benefits and setting out tax breaks to spur job creation.