Examining Tax Incentives And Exemptions
Senate Finance Committee schedules briefing with IRS on Puerto Rico’s tax incentives. A spokesperson for panel Chair Ron Wyden (D-OR) told TaxNotes the committee will hold a private briefing with agency staff to discuss IRS efforts to audit wealthy taxpayers who benefit from tax incentives under Act 22. The 2012 legislation exempts from Puerto Rican income taxes earnings from interest and dividends from local sources, and gains on capital assets accrued and realized after an individual becomes a resident.
Legislation aims to prevent wrongfully detained Americans from facing IRS penalties. Between 40 and 60 Americans are being held unjustly overseas. Sen. Chris Choons (D-MD) has introduced the “Stop Tax Penalties on American Hostages Act,” which would amend the Internal Revenue Code to prevent the IRS from imposing penalties on wrongful detainees and hostages who miss payments while they are held abroad. Currently, the IRS can waive fines, but it does not have the authority to fully forgive interest and penalties.
Sales tax exemptions are under review in Nebraska. Republican Gov. Jim Pillen wants to review the exemptions, since the state collects $2 billion in annual sales tax revenue but offers 100 sales tax exemptionsthat could be costing the state $6.5 billion. “Everybody’s got to play in the game,” Pillen told the Nebraska Examiner.
Speaking of sales tax… A poll conducted by the Chiesman Center for Democracy at the University of South Dakota finds support for Initiated Measure 28, which would repeal the state’s 4.2 percent sales tax on groceries. The tax currently applies to “anything sold for human consumption, except alcoholic beverages and prepared food.”
Farmers usurp the “burp tax” in New Zealand. Nearly half of New Zealand’s greenhouse gas emissions come from its estimated 10 million cows and 26 million sheep. The New Zealand government has abandoned its plans to levy a tax on the emissions of livestock, which would have been set annually based on domestic emission prices from other sectors and offered financial incentives to limit sheep and cow burps. Given backlash from the country’s agriculture sector, the government’s center-right coalition will look for other ways to reduce methane.
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