Items that are blogworthy, but that I haven’t had time to write about, include:
- Today’s news that the Gov plans to offer a cut in the corporate tax rate (from 9.5% to 8.3%), in exchange for movement on closing corporate tax loopholes. According to the Globe, the cut will cost something like $210 million a year, and closing the loopholes will bring in close to $500 million, for a net gain of $280 million or so. Good move? Worth the trouble? Will Sal and his new BFFs in the business crowd bite?
- Recent news that the Gov will float a whopping $368 million increase in education spending. The “education sector” is obviously pleased, but wary about finding the money in a lean budget yet. Can he pull it off?
What’s on your mind?
Please share widely!
– Massachusetts remains a state with a largely regressive tax system, but our state reps are busy writing bills about the “Cell Phone Crisis!”
<
p> – Cities and towns around Massachusetts are falling apart and my state reps are busy with…ahhh…nevermind.
<
p> – I’ve only glanced the Globe’s article, but the corporate rate cut seems like a compromise designed to get things moving – and a sign that the Gov’na learned a bitter lesson last year.
<
p> – Is Randy Moss just “misunderstood?”
<
p> – My city, newton, is about to build a $200M high school – and then ask for an override. Now, we’d need an override (or a debt exclusion) regardless. But the school is going to make it a tough sell.
<
p> – John McCain isn’t a moderate hero, and I wish certain liberals would stop acting like h is. I’m looking at you Doris Kearns Goodwin.
will take considerably less time than tax reform and will have an immediate positive impact.
<
p>I disagree with charley that this is liberal fascism. Liberal fascism would be “don’t talk on a cell phone at all because you’ll get tumors.” This is just a common-sense law that’s long overdue.
I firmly support a cell-phone-driving ban. I don’t think it’s “liberal fascism” — I thought my very use of that preposterous term might have indicated how I felt, but irony’s a tough thing to express sometimes …
<
p>Agreed. Objections that this is a “nanny state” law are off the mark, since it’s not about protecting you from yourself, but rather protecting other people from you.
I haven’t read the hundred comments on the other post, but I’m pretty sure (and his response here, I’m glad to see, confirms this) that Charley was being tongue-in-cheek about “liberal fascism” — it’s a term that has about as much meaning as “Marxist capitalism,” and Jonah Goldberg deserves nothing but ignominy and scorn for having been singlehandedly responsible for such a drastic increase in the overall stupidity of American political discourse.
<
p>Saying “liberal fascism” as though it meant something only makes it less likely that anyone who knows anything will take you seriously.
I’m surprised there hasn’t been more comment on the Mayor’s State of the City address, particularly his comments on education. As I understand what he’s proposing, he would shrink the city’s three large school assignment zones in order to save millions in transportation costs; but of course this is a fraught issue, because it means fewer choices. My own view is that if the savings realized on transportation can be put to use creating more high-quality elementary schools, this is a smart move. But everyone knows this is a fraught topic.
<
p>TedF
How can the Gov’nuh cut corporate taxes and have a massive increase in education spending?
<
p>And wouldn’t closing the tax loopholes be merely a token accomplishment if the move is made revenue neutral by the tax cuts?
<
p>p.s. Combined Mass. biz taxes are only the 40th highest in the nation
Looks like there’s an additional $100m to be found (assuming other things are equal, which they probably aren’t) to fund the education boost, so I agree with you that that seems like a problem. But if the Globe’s numbers are right, the close-loopholes-and-cut-the-tax-rate combo isn’t necessarily a total loser.
our elected and appointed officials and by any of us who are interested in repairing and restoring the public structures that enable our communities to thrive.
<
p>Articulated very well in the next to the last paragraph of today’s Globe article.
<
p>
“This isn’t any meaningful reduction,” Paul Guzzi, president of the Greater Boston Chamber of Commerce, said yesterday. “We need to do things that are pro-competitive. In our view, this package doesn’t fall under that category.”
<
p>There is a proposal afoot to cut the rate to 5.3%. It seems clear that business feels they have Patrick where they want him and are not going to let up. It’s worth noting that the full rate reduction wouldn’t take effect until 4 years from now.
Having trouble mustering the requisite amount of spite toward the Chargers for this weekend? Here you go:
<
p>
Cutting corporate loopholes is good and will bring in as much revenue as the proposed casinos will in their first year without any of the negative consequences. Moreover cutting corporate taxes is good since we want businesses to come to Massachusetts, especially in western mass, and creating corporate tax free zones and other incentives combined with true universal healthcare and our excellent education sector will bring in a boatload of new businesses. This is the kind of thinking I voted for and the kind of direction the lost in the wilderness governor needs to move towards.
<
p>As for increasing education spending again you can look at my city Cambridge which has the highest per capita spending per pupil and some of the worst results for student graduation, matriculation, and passing the MCAS and it shows that the problem with our schools is not a money problem but a management problem. So I am skeptical that this will actually do anything.
<
p>Maybe the Gov can move on to I dont know, getting Cape Wind to work and bringing in that alternative energy sector as well or am is that a promise that he just cant keep?
Any loophole per default is unfair as it enables businesses that are willing to (ab)use it to gain unfair advantage over those who are playing fair. This applies to personal taxes too. I am all for closing loopholes as it promotes anti-social behavior.
<
p>As for lowering the corporate taxes, that’s an entirely different questions and needs to be looked at separately. If corporate taxes are indeed too high (and 4th place in the nation seems comparatively high) then they should be lowered to enable our state to maintain competitiveness.
They’re not 4th in the nation. Corps are taxed FOURTIETH in the nation in Massachusetts. That’s a 4 followed by an 0. 40.
<
p>FYI there are 50 states in this country. That means in only 9 of them do corporations pay less in total taxes.
<
p>Meanwhile, we’re facing a billion dollar budget.
<
p>I’m not opposed to keeping corporate taxes anywhere from average to fairly low, but these loopholes have got to be cut and the taxes certainly can’t be lowered. Cutting the loopholes first will go a long way toward telling us where we actually need to go on the taxation front.
<
p>So, it’s 4
0= 4 as in fourth without the 0. And if the globe is lying to me, I am lying to you too. No need to become aggressive and condescending.<
p>From what I see in your answer, we both agree that the loopholes need to be closed and that corporate taxes should be kept competitive. In addition, I also stated that these two need to be looked at separately.
The Globe knows not what it speaketh. And for your reference, the Mass Tax Foundation is right of center. I hate to be “aggressive,” but, quite frankly, I’m sick of the notion of Taxxachusetts. It hasn’t been that way in decades. People like you need to realize that and, unfortunately, this is how people remember things.
<
p>Taxxachusetts doesn’t exist – at least for corporations. As I’ve said many times, our state corporate taxes are so low and there are so many holes poking through them, that companies like Walmart cost this state more in health care coverage than we tax them (literally). That’s just not right.
Doesn’t mean that the point made in the MBPC paper (not the MTF — they are definitely not the same, and MBPC is left of center) isn’t also a valid one. But facts are facts, and nominal rates are nominal rates.
<
p>Also, phrases like “People like you” is not a constructive way to carry on a conversation.
<
p>If you “hate to be aggressive,” then don’t be.
the day when I realized not everyone can be convinced on the merits of a proposal. I quoted “aggressive,” because I didn’t think I was that to begin with. Perhaps a bit blunt, but not mean. Feel free to disagree:
<
p>
<
p>Like I said, perhaps blunt, but if that hurt someone’s feelings or something, they’ve got to be really sensative. I’ll apologize nonetheless. Furthermore, I know the difference between the MBPC and the MTF, but ufortunately wasn’t paying attention to the actual website I was on, figuring it was just the MTF. My point, however, still stands.
<
p>In any event, whether our rates are nominally high or not, it’s complete fiction to describe Massachusetts as having one of the 5th highest tax burdens, when we have the kind of holes that we have. As I’ve offered before, if we think the taxes are too high after we’ve cut some of the loopholes, we can always go back and fix it. However, it’s a lot harder to raise taxes than cut them, so let’s cut the loopholes first, before we make any cuts to the tax rate.
Who’d you vote for in the last Presidential election or for Governor?
<
p>But first, I’d like to stipulate that the Democrats advocate for higher corporate tax, the Republicans the opposite and the Greens … who cares. I realize that it’s more complicated than that, but give me my stipulation. K?
<
p>How well does your opinion on corporate tax line up with the party you voted for? Spooky.
<
p>Did you ever say, “wow, those Republicans really got it right on that low corporate tax rates” or “Geez, can democrats F up education”
<
p>That’s selection bias. That’s how we monkeys process information, and it’s the reason you believe (rightly or wrongly) that there are Corporate loopholes, a burning and obvious need for Single Payer, and more and more money to be spent on Education. Apparently, we who oppose such ideas are brainwashed morons who married their sister while working for Haliburton. Meanwhile, your guys have formed logical arguments complete with power-point presentations that illuminate the problem and the common sense solution.
<
p>I’m not saying you’re stupid, just human. It’s the reason movements and beliefs survive. You align yourself with a particular party or movement and adopt their ideas. BTW, me? I’m a registered Democrat. Go figure. So, back to the point, MTF says the ranking of Mass in payment of Corporate tax is 4th; MPBC says it’s 40th. One is lying? Come on, you must know the answer is more complicated than that. Did you even both to discern the difference? Take a look.
<
p>So, divorce yourself from the emotional aspect and and consider my perspective:
<
p>(1) Corporations don’t pay taxes; they collect them from individuals. I’m not telling you it’s God’s truth, but I’m am telling you it’s my opinion.
<
p>(2) “Combined reporting” is not the cure for a loop hole. Rather it’s the implimentation of a more logical tax/accounting reporting method adopted by a handful of states, which may result in additional revenue for the state, which the Corporation must take from individuals.
<
p>On the long shot that the arguments begin to make sense, or not, well Sally on. But to conclude that date from MBPC is right and MTF wrong is just … weird. Or, if not weird, then certainly baseless.
Let me just say that I agree with you, but I have to comment
<
p>as I once held the same idea, being that businesses will just charge the customer more to cover increased taxes.
<
p>This would only apply if there either was full pricing elasticity, ie. demand would not decrease with price increases, or if all businesses would pay the same tax, hence all would increase prices the same amount to cover taxes. In reality, there are vast differences in tax rates paid, and (all other things being the same) businesses who pay less will either have larger profits or be tougher competitors, and consequently grow more.
<
p>But, ultimately, yes, all profits, taxes and operating expenses are paid out of the revenues ie. pockets of their customers. It’s just that increases/decreases on the expense side do not correspond automatically 1:1 to the revenue side.
<
p>—
<
p>Back to the argument of “loophole” — you are right, there are no tax-holes as such, but rather legal options for paying less tax than the competition who is either unwilling to do chose such option (say, go offshore) or does not have the option (say, because they are small and do business in only one state). Any such legal option (ie. “loophole”) creates artificial advantages for companies who are willing or able to chose them. I’d rather have businesses try to compete by making better products rather than having better accountants.
You’re exactly the kind of person I’ve long since passed caring about trying to convince. There are other people out there capable of getting it. I’ll move on them. Your line of thought, however, is primed to bankrupt this country and destroy the American dream, whether you can admit it or not.
<
p>Uhm, Is this not the exact same thing that I stated in the beginning? 😉
<
p>
… is about accountability, except when its not or can get away with it.
Combined Reporting does NOT close corporate tax loopholes. Gov. Patrick is proposing to replace the current separate entity tax system with a combined report system. Separate entity reporting is a policy choice to only require businesses that have nexus in MA to pay tax to MA. Combined Reporting is a more accurate way to measure the way that multi-state businesses are structured today.
<
p>To say that Combined Reporting is closing loopholes is simply inaccurate. Its akin to saying that the minimum wage was raised to close the loophole where businesses could only pay 5.25 per hour to their employees. It was a specific policy choice to set the amount at 5.25, just as it was a specific policy choice to have a separate entity corporate tax structure.
A company can make a simple decision that would allow them to negate paying Massachusetts taxes, when doing business here. That, sir, is a loophole – and one that needs to be cut.
<
p>What’s the simple decision?
They can “rent” their business location from Corporate HQ, thereby negate paying a large portion of their taxes. As I’ve linked to several times, Walmart does this to such great effect in Massachusetts that they actually cost us more money than we tax. If we got rid of that loophole, however, that would change. Their profit margins would still be huge, no one would have to be laid off, etc. etc. etc.
<
p>It isn’t always a choice between corporate profit and jobs, as you like to lay claim to. Believe it or not, companies can pay their fair share and still make huge profits that wouldn’t require job loss or other economic nonsense you like to spout.