Government will stay open, at least until December 11.
On the Hill… The Senate and House passed funding bills to keep the government open through December 11, with just the usual minutes to spare. Now that that’s taken care of, the Senate Finance Committee holds a hearing today on improper payments in federal programs. Comptroller General of the United States Gene Dodaro will testify.
Deficit, Schmeficit. Every GOP presidential candidate seems to be backing tax cuts for all, even if they add between $3.6-$12 trillion to the deficit. What happened? Oren Cass, Mitt Romney’s domestic policy adviser during the 2012 campaign, said “There's nothing to be gained from being responsible… You may as well do the plan that your base is going to love.” The Tax Foundation’s Kyle Pomerlau says of the candidates, “They're saying 'let's cut taxes for everyone so we're not accused of raising taxes for [anyone].’”
“I just want to say two words to you: Data centers.” They’re the brains of the internet, and states have been offering tax breaks to them for the past decade, to the tune of about $1.5 billion. The Associated Press reports that the actual cost might be higher, as some states won’t disclose the amount of waived taxes. Cities and counties often forgive millions of dollars in local taxes, too. Data centers cost hundreds of millions of dollars to build, but employ few people.
Illinois GOP Governor Bruce Rauner wants ConAgra. The packaged food company calls Nebraska its home, but plans to lease enough office space in Chicago for 1,000 workers. The Illinois governor met with the company early in 2015 to offer an unspecified amount of Edge tax incentives to move to Illinois. Since then, Rauner has put a moratorium on such tax deals until the state’s budget impasse is solved.
In Denmark, tax breaks for electric cars are too costly. Denmark’s new government is no longer interested in meeting ambitious CO2 emissions targets or becoming fossil-fuel free by 2050. Why? Denmark needs money. The three-month-old government expects to raise just under 30 billion kroner on car taxes in 2016. It estimates that if electric cars are taxed like gas-powered vehicles, Denmark will gain 450 million kroner a year in revenue. The price of a Tesla will nearly triple. Meanwhile, the Danes would eliminate pollution taxes on diesel cars.
In Italy, it’s not so easy to tax Google. Or any other multinational internet firm. Italy’s Treasury Undersecretary Enrico Zanetti says a tax on such firms’ profits earned in Italy could raise up to 3 billion euros ($3.36 billion). In 2014, Google paid tax of 19.3 percent on its global earnings. The average corporate tax rate on earnings in Italy is 65.8 percent but European Union tax law does not require a company to pay a country’s tax when there is no "permanent establishment” in that country.
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