Could a Los Angeles 'gun tax' discourage ownership?
Los Angeles city councilmen say a gun tax could raise up to $1 million per year for the city. The tax would echo similar moves in other cities, including Chicago.
“Hey, hey Paul…” House Ways & Means Chair Paul Ryan remains under the glaring spotlight of a party that wants him to be the next Speaker of the House. Representative Tom Cole of Oklahoma believes he “is the right man for the moment.” Meanwhile, the House Freedom Caucus wants Ryan to talk with them if he wants the job. And former Speaker Newt Gingrich urges caution, should Ryan run and win the Speakership: “If you’re not careful, by Christmas you resemble John Boehner.” So far, at least, Ryan stays on the sidelines.
There’s a Democratic debate tomorrow night. The party’s first presidential forum this year could give candidates a chance to discuss their tax plans. Will they? TPC’s Steve Rosenthal takes a look at Bernie Sanders’ and Hillary Clinton’s respective plans for taxing Wall Street. The choice: Go big or go small. Sanders would tax Wall Street enough to fund college education for all, raising an estimated $300 billion a year. Clinton would tax algorithmic traders: They place and then cancel millions of orders a year. Her plan wouldn’t raise as much revenue as Sanders’ but could curb some market abuses.
Speaking of algorithms: Are they the future of auditing? Right now, the IRS relies on data mining by forensic accountants to uncover tax shelters. But researchers at the Massachusetts Institute of Technology and the nonprofit Mitre Corporation have developed a computer algorithm that detects “rule mining.” That’s where you line up individual tax code regulations to see if, when applied together, the regulations produce a tax dodge. The researchers created a specific algorithm that can root out one tax avoidance scheme in partnership structures. The shelter artificially boosts the basis value of an asset, so much so that capital gains are zeroed out when the asset is sold.
A gun tax in Los Angeles? City Councilmen Paul Koretz and Paul Krekorian have proposed a tax on gun sales that could raise $1 million a year. Koretz said, "If you want to have a gun, you can have one, but you have to pay an extra tax that pays for some of the societal costs of guns." The Urban Institute estimates that California hospitals spent about $87 million on firearm assault injury costs in 2010. Taxpayers covered about 65 percent of it. Two other cities have made comparable tax moves. Chicago enacted a gun tax in 2012. Seattle’s gun tax is due to go into effect in January—but the National Rifle Association and two other gun groups have challenged it in court.
Worth repeating: Income taxes alone don’t drive employment and relocation decisions. TPC’s Richard Auxier raises an eyebrow at a new report from Americans for Tax Reform and the Canadian Taxpayers Federation. Their report claims income taxes drive free agency in the National Hockey League—making 54 percent of NHL free agents choose teams with low taxes. Problem is, the report relies on incomplete methodology and rather spurious reasoning.
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