Internet Tax

Germany taxes the internet

The power to tax is the power to destroy. The internet has proven rather a bother to many of those with power, allowing anyone with a computer to reach a worldwide audience. Now, our friend David Kaspar, of Davidsmedienkritik, a fine site keeping track of media and events in Gemrany, brings news of Germany’s plans to tax the internet.

Germany’s 16 states agreed on Thursday to introduce from January 1 a licence fee of 5.52 euros (3.70 pounds) a month on computers and mobile phones that can access television and radio programmes via the Internet.

Any household or company that does not already have a licence will have to pay the new levy, which is the same as the one currently charged for radio access, state premiers agreed at a meeting in the town of Bad Pyrmont.” Read entire article.

The American Thinker
October 30, 2006

Federal Tax

Baucus Charges that Failure to Renew Extenders Equals Tax Increases

Senate Finance Committee ranking member Max Baucus, D-Mont., called again on October 25 for swift passage of expiring tax cuts, issuing the call after President Bush noted in a morning press conference that a failure to renew tax cuts would result in tax increases for the American people. In his statement, Baucus said that, although Bush was referring to what Republicans term "tax increases," if his major tax bills passed in 2001 and 2003 are not made permanent, Bush unwittingly implied that Congress was willing "to saddle Americans with tax increases" on college tuition, state and local sales taxes, and supplies that teachers buy for their classrooms by its failure to approve the expiring tax provisions. Read entire article.

By Jeff Carlson and Paula Cruickshank
CCH Tax News
October 26, 2006

Report Says Tax Cut Permanency Would Shift Burden to Middle-Class; President Defends Cuts

A fact sheet released by the nonpartisan Tax Policy Center on October 23 describes the 2001 and 2003 tax cuts as regressive and making them permanent would shift the burden of the federal tax system onto middle-income taxpayers.

The authors indicated that, in 2011, if the tax cuts are made permanent and there is an alternative minimum tax (AMT) fix, taxpayers in the top one percent of the income distribution would receive 28.2 percent of the total benefits despite paying only 24.7 percent of all federal taxes. Their share of the overall federal tax burden would then fall by 0.5 percentage points. Read entire article.

By Jeff Carlson and Paula Cruickshank
CCH Tax News
October 25, 2006

SFC to Review JCT Options to Close Tax Gap; Baucus Presses Everson on Extenders Tax Provisions

Senate Finance Committee Chairman Charles E. Grassley, R-Iowa, and ranking member Max Baucus, D-Mont., said on October 19 that they plan to review further recommendations by the Joint Committee on Taxation (JCT) on how to close the tax gap (TAXDAY, 2006/10/20, C.1). The discussion options were made available through a new JCT report (Additional Options to Improve Tax Compliance) following up on an earlier publication "Options to Improve Tax Compliance and Reform Tax Expenditures" (JCS-2-05). The two lawmakers said that they would not necessarily end up endorsing all the recommendations but would continue to work at reducing the tax gap.

Baucus on October 16 pressed IRS Commissioner Mark Everson to explain how the Service plans to deliver information on the extenders tax provisions if Congress acts in November (TAXDAY, 2006/10/17, C.1). Everson earlier had informed the Senate Finance Committee that, if the extenders were not enacted prior to October 15, 2006, then the IRS would have to rely on the law as it stood on that date.

Twenty years after the last major tax reform act was signed into law, former U.S. Senator Bill Bradley, D-N.J., and Senate Finance Committee member Ron Wyden, D-Ore., have scheduled a news conference on October 23 to urge President Bush to join Congress in enacting new tax reform. Wyden is the author of the Fair Flat Tax Bill of 2005 (Sen 1927), a tax reform package that calls for a simplified tax code. Bradley was an original Senate sponsor of the Tax Reform Act of 1986 (P.L. 99-514).

CCH Tax News
October 23, 2006

State Tax

All States --Sales and Use Tax: SST Group Debates Merit of Dollar Cap in Bundling Definition

After a conference call to discuss revising the "bundled transaction" definition in the Streamlined Sales and Use Tax (SST) Agreement, the states found themselves close to where they were at the end of their most recent in-person meeting, in Columbus, Ohio. (TAXDAY, 2006/10/10, S.1) A majority of states participating in the call expressed support for adding a "cap" in the amount of $10,000 to the de minimis test currently in the definition. Therefore, a transaction that otherwise meets the definition of a "bundled transaction" would fall outside that definition only if the purchase price or sales price of the taxable component is both (1) 10% or less of the total price of the bundle, and (2) equal to or less than $10,000. Read entire article.

CCH Tax News
October 27, 2006