The Tax Foundation has released the third annual International Tax Competitiveness Index. Once again, the United States ranks among the bottom 5 countries with the 5th least competitive tax system in the OECD. Only Greece, Portugal, Italy, and France have less competitive tax codes. On the other end of the spectrum, Estonia takes the number one spot once again, with New Zealand and Latvia having the second and third most competitive tax systems, respectively.
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Petition from CitizenGO and the Austrian Economics Center:
The European Commission recently accused Ireland of giving “illegal tax benefits” to Apple. Now, they want Ireland to retroactively charge €13 billion to Apple due to this “unfair” treatment.
This ruling by the European Commission is extremely dangerous. Such an overreach by the EU’s antitrust regulator puts Ireland’s national sovereignty—and the sovereignty of all EU nations—under threat.
According to Greek and Roman mythology, Saturn devoured his own sons. The Commission runs the risk of doing something similar to European nations by taking away their national sovereignty and their opportunity to succeed economically.
Ireland’s policy towards Apple was an intelligent use of tax competition and globalization. Threatening foreign direct investment in Ireland would condemn the country to stagnation and poverty.
We believe that the European Commission should overturn this ruling and immediately abandon their dangerous and damaging tax harmonization policy. The Commission should respect the national sovereignty and economic freedom of all European nations.
SIGN THE PETITION HERE: http://www.citizengo.org/en/signit/37265/view
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Sweden might not have much to teach other countries about tax policy. The tax-to-GDP-ratio of 42.8 percent (2013) exceeds the OECD average by nearly 9 percentage points. Our marginal tax rate on labor income is the world’s highest, and the capital gains tax is almost twice as high as the average in the EU, OECD and the BRIC countries. That being said, the developments from the year 2000 until today might still be interesting even for foreign readers.
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Troy Lanigan and Krunoslav Saric from Lipa – having a great time at the Atlas Conference in Miami last weekend!
ANALYSIS/OPINION:
Why is it that many politicians and journalists can quickly grasp the idea that if the tax on cigarettes or soft drinks with sugar is increased, the demand for them will decline, but seem unable to understand that increasing a tax on labor, like a mandated increase in the minimum wage, will cause a decline in the demand for labor, leading to higher unemployment?
A number of years ago, I was on a European speaking tour with a couple of other economists. One had received a Nobel Prize in economics. He was exceptionally smart, a math whiz, and a most pleasant fellow. Among his many accomplishments, he developed investment models with others, which were used to forecast. One of the forecasts had turned out to be spectacularly wrong and costly. When chatting with him about the matter, I realized that the problem was the number of years of data they used was too few (more years of the necessary data were not available at the time) to give them the level of certainty they thought they had. In our conversations, I also came to understand that he had done only limited reading in economic history (it was not his field), and was unaware of various financial and monetary bubbles and crashes that have occurred over the last few centuries. Perhaps if he and his colleagues had been as well schooled in economic history as they were in applied mathematics, their risk assessments might have been different.
It is always disheartening to hear politicians propose policies that will not make citizens richer with more opportunities as claimed, but make them less wealthy with fewer options. Politicians who advocate for higher capital gains tax rates, higher taxes on the “wealthy,” higher inheritance tax rates, higher tariffs, more government spending and more regulations, fail to recognize, or admit, that all of this has been tried many times before, with disastrous results. They are either ignorant of economic history or are relying on the ignorance of the press and the people to buy such claptrap. Even more disconcerting are those economists who try to make an argument of why this time the outcomes from bad policies are going to be different — apparently to curry favor with the political and media class.
The high priests of many academic disciplines, with the intent of making it seem more difficult, create many unnecessary new words, when simple, commonly understood words in the English language will suffice in most cases. Economists have not only been guilty of that sin, but in recent decades, have developed the fashion of insisting that almost every academic article be expressed in mathematical terms, or at least have a mathematical appendix, even when totally unnecessary or inappropriate. The result has been that increasing numbers of economics students, both at the undergraduate and graduate level, have spent much of their time studying math rather than economic principles and history. In 2000, the noted economist Thomas Sowell wrote a very fine and well-reviewed introduction to economics, “Basic Economics: A Citizen’s Guide to the Economy,” proving that it was possible to write a clear, accurate and concise economics text without equations, graphs or jargon.
The great intellectual debate among non-socialist economists about the proper role of government during the last 80 years is largely between the followers of John Maynard Keynes and the Austrian school of economists led by F.A. Hayek and Ludwig von Mises, and their frequent Chicago school allies led by Milton Friedman. The great tragedy is many economic students graduate without knowing who Friedman and Hayek were, let alone their contributions to economic thought. Prime Minister Margaret Thatcher and President Ronald Reagan were fans and disciples of Hayek, while many big-government types tend to be Keynesians. Without understanding the substantive debate between these two conflicting visions, it is hard for members of the press and the political class to present coherent thoughts on many public policy issues.
For those wishing to acquire basic economic literacy without the technicalities, I suggest the 2016 edition of short classic bestseller for non-economists, “Common Sense Economics: What Everyone Should Know About Wealth and Prosperity,” by James Gwartney and others. Again, for those who have no background in economics but would like to learn about money and the great bubbles and panics of the past, I recommend the very entertaining bestseller, “The Ascent of Money: A Financial History of the World,” by the distinguished historian Niall Ferguson. This book was adapted for an Emmy Award-winning PBS documentary. Finally, the single best one-volume book on the history of economic thought — both entertaining and dense in useful information, and now in its third edition — is Mark Skousen’s “The Making of Modern Economics: The Lives and Ideas of the Great Thinkers.” The above books provide what one needs to distill the sense from the nonsense about economics coming from the media and political class.
Great Economic Reads, especially geared to non-economists:
A short, classic bestseller for non-economists:
“Common Sense Economics: What Everyone Should Know About Wealth and Prosperity” by James Gwartney
The single, best one-volume book on the history of economic thought, according to U.S. economist Richard Rahn:
Mark Skousen’s “The Making of Modern Economics: The Lives and Ideas of the Great Thinkers.”
On the 30th September, it was the 28th Anniversary of the World Taxpayers Associations! The WTA was established, at the National Press Club in Washington DC, on the 28th September 1988 by Bjorn Tarras-Wahlberg, the National Taxpayers Union (USA), and the European Taxpayer Association’s (ETA) president, Rolf von Hohenhau. Nine other countries joined in the launch of what was then called, the Taxpayers Associations International (TAI). Congratulations Bjorn, NTU & ETA on keeping the global fight for economic freedom going all these years!
See the write up of it at the time in the Dollars & Sense publication here.
“High Taxes = Low Economic Growth
Low Taxes = High Economic Growth”
~ Bjorn Tarras-Wahlberg
“There are only two things that are certain in life: Taxes and Death, but unfortunately they come in the wrong order.” ~Benjamin Franklin
WTA is proud to announce that it has a new member, the Slovenian Taxpayer Association, established by Marusa Pozvek only in 2015.
They have already launched an accredited Summer Course Program called “Taxation and Development” this past August 2016.
We look forward to working with them, and seeing what they do next!
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Here is the multi-page edition of the World Taxpayers Conference 2016 featured in Germany’s widely-circulated Handelsblatt. In-depth articles and photos. It was a great time had by all, and our most diverse conference to date!
handelsblatteventeditionmay2016
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The Lithuanian Free Market Institute (LFMI) has developed a great tool called the Tax Calculator, and they want to share it with you!
This is a wonderful idea for a taxpayer group to bring awareness to people on how much tax they actually pay.
LFMI’s tax calculator http://mokumokescius.
How it works: Creating the calculator, one indicates the individual net wage income, get the amount of income and social security contributions (and a breakdown of these), and then travel through the personal expenditures to see what taxes are paid every time money is spent on different categories of goods or services.
At the end, one gets the total personal tax amount paid and the personal Tax Freedom Day, and finally gets the personal bill from government showing where the government spends the taxes paid (the tax amount is broken down by government expenditure areas). One can also go through those government spending areas to see how much they constitute in terms of government revenues and spending proportions.
LFMI can help other groups to replicate the tax calculator. They provide the roadmap and the application package with uncompressed working files of illustrations, codes, website style guidelines at no additional cost. They also give the texts and translations.
Other adaptations: LFMI has adapted the tax calculator for Poland http://sprawdzpodatki.pl.
If you are interested in adapting this Tax Calculator to your country, please contact their Development & Programs Director, Aneta Vainė: aneta@freema.org. They are eager to help!
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