Taxes

For getting out of the public finance crisis it is a good thing to cut on spending. To reform the public sector is even better. But is it also necessary to increase taxes? With few others, Jean Philippe Delsol, administrator of IREF, had developed the conviction from past experience that one should instead decrease the tax burden.

Question: Mr. President announces that, starting in 2011, there will be a sharp increase in tax rates. What do you think individuals and businesses will do in 2010? Using basic economics, Arthur Laffer in a Wall Street Journal article dated June 6 gives us a very plausible scenario: Individuals and businesses will do their best to transform the wealth and income to be taxed in 2011 into wealth and income to be taxed in 2010.

A recent study by Duanjie Chen and Jack Mintz, School of Public Policy, University of Calgary is estimating the effective corporate tax rates in 80 countries. These effective rates are taking into account statutory rates plus tax base items that affect taxes paid on new investment, such as depreciation deductions, inventory allowances, and interest deductions.

In the recent past, many States resorted to public spending increases in order to boost their shaky economies. At present, they have to face great deficits. They believed, no doubt, that there is no need to obey to financial constraints, but the market reminded them that any debt has to be reimbursed some day. Indebted and weakened governments are now forced to cut on spending and increase taxes. Hence an urgent need for a scapegoat. Fortunately enough, there are still some places to turn to for a credible alternative. Analysis from Jean-Philippe Delsol.

According to Eurostat, the public expenditure in Romania in 2009 was 40.4% of the Gross Domestic Product. This means nothing else but the fact that 40.4% of the wealth was spent by someone else, not by the people who actually produced it. On average, they could dispose only 59.6% of the results generated by their efforts. This implies that romanians worked 147 days for the state. Consequently, 28th of May is the Tax Freedom Day for the Romanian taxpayers.

IREF is presenting for the third consecutive year a unique report on taxation in Europe. You can find here expert analysis of the fiscal policy in 22 european countries, the most recent data and forecast for future developments. Summary by Professor Pierre Garello.

Traditionally in France the rich are suspected to be responsible for every bad thing happening within the economy. The current crisis is no exception to the rule and many voices are heard saying that the rich should pay more taxes to redeem themselves from their sins that brought the crisis.

In the Boston Tea Party (Dec. 1773) local patriots dressed as Mohawk Indians and dumped the containers of tea into the harbor. The British parliament had passed the Tea Act to establish officials in major American cities to collect the new tax on tea (Americans had been buying tea from Dutch merchants outside of customs). The English East India Company had gained control of Bengal, and in taxing it caused a famine which destroyed the income of the company and depressed the stock value in which many members of parliament had invested.

We are delighted to announce that the French government definitely abandoned the project to ntroduce a carbon tax. This decision came after the ruling of the Constituional Council at the…

The Washington state Senate approved a tax package that would raise $890 million over the next sixteen months. The tax package includes a temporary three-tenths-of-a-cent sales tax increase plus increased…