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What A Zombie Movie And Washington Have In Common

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What A Zombie Movie And Washington Have In Common

Coming soon to a theater near you: The House embraces a one-year “tax extender” package. It would restore retroactively for 2014 tax breaks affecting all manner of taxpayers—from research-heavy corporations, multinationals, teachers, commuters, and green energy producers, to NASCAR race tracks operators, Puerto Rican rum producers, racehorse owners, and Hollywood moguls.

The one year cost: about $45 billion. The White House is open to this short-term package. But in the Senate, Democrats, and even some Republicans, say the bill is a non-starter.

A zombie movie by any other name stinks just as much. Like any bad movie, the drama surrounding allegedly temporary tax cuts needs a rewrite. TPC's Howard Gleckman has some notes. Give depth to the main characters, “the extenders,” by calling them what they really are: Expired tax breaks. Add some tension to the plot by making expired tax breaks play by the same rules as any other tax cut: Offset them with other tax hikes or spending cuts.

It might not be Oscar-worthy, but it'd be a movie your average taxpayer might actually like to see.

Corporate inversions don't come cheap. Bloomberg reports that US companies that already inverted are likely to reduce their taxes by $2.2 billion or more next year, double the amount in 2014. Bloomberg calculates that since the first inversion in 1982, the US Treasury has lost more than $9.8 billion in revenue, after adjusting for inflation.

Corporate tax reform: could it happen next year? The next Chair of the House Ways & Means Committee, Paul Ryan, thinks a focus on corporations and other businesses might be worth it when it comes to tax reform, even if individual tax reform has to wait.

A month ago, he said, he wanted to do only full-blown reform. The Obama Administration has signaled a similar interest in business reform only.

Want better tax policy? Get better data. TPC's Len Burman makes the case that US tax policy suffers from a lack of high quality data.

For example, if states were encouraged to experiment and collect the evidence necessary to evaluate the effects of tax policies, we might end up with “sufficient information to measure accurately the economic gains from tax reform.”

Take the “angel investor credit,” for example. A new Tax Fact by TPC's Norton Francis takes a look at them, offered in 29 states. The credit is generally worth between 25 and 50 percent of the investment. States offer the credits hoping to attract new high-tech clusters and generate economic activity. Francis concludes, however, that some of this investment might have occurred anyway.

The EITC: A fresh look at a long-standing safety net. A new TPC paper by Ben Harris and Lucie Parker offers a fresh look at Earned Income Tax Credit claim rates across zip codes. As one might expect, people living in high-poverty communities receive the EITC at higher rates than people in zip codes with low poverty rates.

The correlation between poverty and race likely explains why counties with more EITC recipients have higher concentrations of African-Americans, and are overwhelmingly located in the Southeast.

Interested in subscribing to The Daily Deduction, the Urban-Brookings Tax Policy Center summary of the day's tax news? Sign-up here for free access. If you'd like to tell us about a new research paper or have any comments about our new feature, write us at dailydeduction@taxpolicycenter.org.

The post Extender Drama: Some Movies Just Aren't Worth Seeing appeared first on TaxVox.

Image credit: Daniel Hollister, Flickr

The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

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