Archive for the ‘tax’ tag
Personally, I don’t think hospitals should be exempt from property tax. What exactly is the standard here, that if a corporation “does good” they don’t have to pay their fair share of tax? Who defines what the good is? Who monitors it?
Lisa Schencker reports:
Illinois not-for-profit hospitals currently are exempt from having to pay hundreds of millions of dollars in property taxes so long as the value of their charitable services is equal to or greater than their estimated tax liabilities.
But some municipalities argue that many not-for-profit hospitals are more like businesses, making handsome profits. They say hospitals should have to contribute their fair share of taxes to their communities, like any other business. A 2009 report by the Center for Tax and Budget Accountability said 47 Chicago-area not-for-profit hospitals had property tax exemptions worth a total of $279 million.
About 156 of Illinois’ more than 200 hospitals are not-for-profit.
In the case before the state Supreme Court, the city of Urbana and others argue that Carle Foundation Hospital in Urbana should not be exempt from paying property taxes. They say the 2012 state law allowing hospitals to be exempt if they provide charity equal in value to their property tax liabilities is unconstitutional. The state constitution only allows such exemptions if the property in question is used exclusively for charitable purposes, they say.
Urbana Mayor Laurel Prussing said after oral arguments Thursday that regardless of what the court decides — or doesn’t decide — the issue is one the legislature should weigh.
The hospital association might work with lawmakers to craft a new law if the court strikes the current one down. Association President and CEO A.J. Wilhelmi has said the group will “assess all options” once a ruling is made.
“Why should the most profitable companies in the state be shifting their burden onto every other business and homeowner?” Prussing asked.
Last year, a study published in the journal Health Affairs named Carle the 10th most profitable hospital in the country when it came to patient care services, with $163.5 million in profits in fiscal year 2013.
(click here to continue reading Illinois Supreme Court weighs whether hospitals must pay property taxes – Chicago Tribune.)
I don’t believe that churches should be exempt either, unless they can scientifically prove that god exists. Are medical cannabis dispensaries tax exempt? Planned Parenthood clinics? Is Feeding America’s offices on Wacker Drive tax free? What about ACLU headquarters? Union halls? Bars and taverns? Wrigley Field? Seriously, where does it end? Our society would be much better off and more equitable if corporations didn’t get so many freebies from taxpayers. I’ve always liked the idea of a “mandatory minimum” for corporations above a certain size – the idea that Boeing and Archer Daniels Midland and all the rest can’t evade taxes by exploiting shell corporations and loopholes.
Wow, 9% is rather a large increase to my Netflix bill. I wonder if databases like Hoover’s will be affected? Seems like they might.
Chicagoans who pay to stream movies and music from services like Netflix and Spotify will now need to fork over an additional 9 percent for the privilege, as will Chicago businesses that pay to use everything from real estate to court databases online, under a decision the city quietly made recently to expand its taxing power.
The added costs are the result of a ruling by the city Finance Department that extends the reach of ordinances governing two types of taxes — the city amusement tax and the city personal property lease transaction tax — to cover many products streamed to businesses and residents alike.
According to the Finance Department changes, the 9 percent amusement tax, which has mostly been tacked onto tickets to concerts and sporting events, also now applies to paid subscriptions for streamed digital music and to streamed rental movies or TV shows, and “for the privilege of participating in games, on-line or otherwise,” if the person paying to receive the data is in Chicago.
The personal property lease transaction tax expansion also applies to professional services, like electronic property databases real estate agents use, court case databases lawyers rely on and various financial information networks.
(click here to continue reading City extends taxing power to online movies, music, more – Chicago Tribune.)
Could I get around this by using a VPN?
It is almost amusing how much crazy economic policy was initiated by the expense account of Dick Cheney and Donald Rumsfeld. Without the Laffer Curve, there would be no Supply Side Economic Voodoo theory, and perhaps our country wouldn’t be on a downward spiral. Also, the Laffer Curve, as originally formulated, never claimed to know what the magical tax rate was, and in fact, could be interpreted as arguing that tax rates should increase!
The Laffer Curve came about as the result of a lunch conversation in 1974 among conservative economist Arthur Laffer, Dick Cheney, and Donald Rumsfeld. The curve in question is the relationship between tax revenues and tax rates—at zero percent, no tax revenue will be collected because no income is taxed, while at 100 percent, no revenue will be collected because there is no incentive to work if all income is confiscated. Somewhere in the middle is a sweet spot: the perfect rate of taxation at which revenue is maximized, and where any tax increases past that point will actually result in a decrease in revenue.
The Laffer Curve has been consistently used as justification for the supply-side belief that tax cuts will pay for themselves through the increased economic activity that they will create. This belief is no longer simply a theory, but is now official federal policy: the 114th Congress changed the rules for how budget bills are evaluated from static scoring to what is called “dynamic scoring,” which will mask the actual cost of tax cuts by simply assuming that they will increase economic output.
(click here to continue reading The Laffer Curve has flatlined.)
As an aside, I’m amazed that for years, the PR slogan was that the Republican Party was the business party, despite much evidence to the contrary.
Since World War II, there’s been a strikingly consistent pattern in American politics: The economy does much better when a Democrat is in the White House.
More specifically, since 1947, the U.S. economy has grown at an average real rate of 4.35 percent under Democratic presidents and just 2.54 percent under Republicans
(click here to continue reading The U.S. economy does better under Democratic presidents — is it just luck? – The Washington Post.)
Really though, it seems as if the GOP is better for business executives instead of businesses. The executives make more, by outsourcing jobs, enjoying reduced tax rates and increased tax loopholes for things like private jets and so on. More take-home pay, in other words, and less investing in the business itself. For non-executives, the GOP is not your party, nor are you even invited, except during election season.
Reactionary conservatives like Governor Sam Brownback and Governor Scott Walker have put the Laffer Curve to work, slicing government revenue, with predictably dire results:
Kansas Gov. Sam Brownback brought on Arthur Laffer as an advisor to steer his radical experiment of cutting taxes to the bone under the assumption that the cuts would simply pay for themselves through economic expansion. The results, however, have been absolutely horrific: job growth on the Missouri side of the Kansas City metropolitan area is occurring at four times the rate on the Kansas side. Education is being vastly underfunded. And perhaps most tellingly, the state collected far less money in taxes than it expected in December, even after downgrading expectations. In other words, Laffer was wrong in every single way possible.
In Wisconsin, meanwhile, Republican Gov. Scott Walker has followed a path nearly has extreme as that of Brownback, but is being forced to scale his ambitions back because the theory just isn’t working:
Earlier this year, just before enacting the half-billion-dollar tax cut, Walker said it was just the beginning — that he wanted to eliminate income taxes. Now, a representative of Walker, asked about the elimination plan said the governor “has only said that he would explore other areas of tax reform.” The state has a projected $2.2 billion deficit for the next biennium, 2015 to 2017. There’s also a transportation funding problem.
Now, not even his top allies in the House think new cuts aren’t possible.
The situation is so bad in Wisconsin that to try to balance the budget in anticipation of a possible 2016 presidential campaign, Walker is rumored to be considering selling off public assets as a stopgap measure just to make the numbers look good. The contrast with states like California, which raised taxes to help balance its budget and cover a shortfall in education, couldn’t be clearer: California’s revenue is surging, while tax-cutting states are figuring out how to mitigate the damage.
(click here to continue reading The Laffer Curve has flatlined.)
Will this example stop the next GOP executive branch from claiming that cutting tax rates will help grow economies? Probably not. In fact, I wouldn’t be surprised if newly elected Illinois Governor Bruce Rauner tries his best to lower tax rates on his own wealth during the next four years. If Rauner was such a good business man, perhaps he’d let facts and history convince him that perhaps the marginal tax rates are too low…
To maximize real economic growth in the United States, the top marginal income tax rate should be about 65%, give or take about ten percent. Preposterous, right? Well, it turns out that’s what the data tells us, or would, if we had the ears to listen.
This post will be a bit more complicated than my usual “let’s graph some data” approach, but not by much, and I think the added complexity will be worth it. So here’s what I’m going to do – I’m going to use a statistical tool called “regression analysis” to find the relationship between the growth in real GDP and the top marginal tax rate. If you’re familiar with regressions you can skip ahead a few paragraphs.
Regression analysis (or “running regressions”) is a fairly straightforward and simple technique that is used on a daily basis by economists who work with data, not to mention people in many other professions from financiers to biologists. Because it is so simple and straightforward, a popular form of regression analysis (“ordinary least squares” or “OLS”) regression is even built into popular spreadsheets like Excel.
(Click here to continue reading http://angrybearblog.com/2010/12/top-marginal-income-tax-rate-should-be.html The top marginal income tax rate should be about 65%…)
Gail Collins provides a good elevator pitch description of a tax policy tool called tax extenders…
One of the very, very few things the current Congress seems determined to deal with before it vanishes into the night is the problem of “tax extenders.” Extenders are strange but much-loved little financial mutants. Sort of like hobbits or three-legged kittens.
Congress, in its wisdom, has created a raft of temporary tax breaks for everybody from teachers to banks that make money overseas. Most are really intended to be permanent. But calling them short-term measures tricks the Congressional Budget Office into underestimating how much they cost.
“If you pass a new tax cut, you’ve got to find offsetting spending cuts. But these are in a sense free,” said Howard Gleckman of the Tax Policy Center.
After the election, both parties appeared inclined to just extend all the tax cuts for two years while making principled mumbling about reform down the line.
But then the Koch brothers roared into the picture. They feel that it’s wrong for the government to give a special benefit to an industry that’s one of their competitors. Especially a government that they and their associates devoted nearly $60 million to getting into office. Politico reported that their representatives have been meeting with Speaker Boehner’s staff.
And you know, they have a point. If Congress actually wanted to do serious reform, it should get rid of special tax breaks for the wind and solar energy sectors. While, of course, also removing all the tax breaks for drilling oil.
(click here to continue reading Congress Extends Itself – NYTimes.com.)
Illinois Democratic governor Pat Quinn, the incumbent, is not someone to get excited about, but his opponent in the upcoming election is a non-Mormon clone of Mitt Romney, down to the off-shore tax havens. Bruce Rauner won’t release his tax returns either, basically thumbing his nose at the electorate.
Multimillionaire Republican Bruce Rauner has channeled at least part of his fortune into the Cayman Islands, a Caribbean paradise long criticized as a tax haven for American investors, the Chicago Sun-Times has confirmed.
A Rauner spokesman insisted that the former private equity investor has met his legal tax obligations and properly disclosed to the federal government information regarding at least five investments by him or his firm in a country that has no income tax and a financial system cloaked in secrecy.
Rauner’s campaign has refused so far to release a full set of his most recent tax returns to corroborate that and perhaps show the extent and value of those investments in offshore companies. No one has suggested Rauner has done anything illegal. In fact, offshore investments among the wealthy have been a common practice in recent years.
(click here to continue reading Bruce Rauner channeled part of fortune to Cayman Islands | Early & Often.)
Are people really going to vote for this plutocrat who is too good, too powerful, too rich to pay his fair share of taxes to a near bankrupt state? If you planned to run for political office, why would you do this? And worse, once news of Rauner’s lack of patriotism was exposed, he doubled down on it.
Republican gubernatorial candidate Bruce Rauner funneled part of his wealth to a Caribbean territory long considered a tax haven, a business practice he defended yesterday, stressing there was no impact on his personal tax rate.
A central part of Gov. Pat Quinn’s re-election bid has been scrutinizing how the multimillionaire Rauner made his money, and the Chicago Democrat’s campaign has alleged Rauner “stashed” money to avoid paying taxes. “I’d think someone who anticipates being in the public eye wouldn’t be in the Cayman Islands because the question to be asked is, ‘Why would you have invested there?'” Richard L. Kaplan, a University of Illinois law professor told the newspaper. “
AT NO POINT HAVE I TRIED TO AVOID TAXES’
Rauner dismissed the notion yesterday after speaking to Asian leaders in Chinatown.
“At no point have I tried to avoid taxes or done these things that they’re trying to spin,” he said…
“GTCR has its own structure for just a couple of investments. When they invest in overseas companies, they set up that particular structure. It doesn’t impact our personal tax rate whatsoever.”
Cayman, a British territory, is considered one of the world’s largest financial centers and a haven for mutual funds and private equity. International companies and ultra-rich investors have long taken advantage of offshore financial centers there, drawn by regulations and legal systems making it easy to move capital internationally.
(click here to continue reading Rauner defends Cayman Islands money move – Government News – Crain’s Chicago Business.)
and as Aaron Cynic of the Chicagost writes, this isn’t trivial amounts of money, but most likely millions of dollars:
While Rauner might be in full legal compliance, the practice itself allows major corporations and other wealthy individuals to skip out on paying taxes in the United States. According to a June report from the group Citizens for Tax Justice, U.S. based multinational corporations booking profits in tax shelters like the Cayman’s has allowed them to skip out on an estimated $90 billion in federal income taxes. For someone trying to save the Illinois economy with a tax plan that targets professional and business services – many of which are smaller businesses – sheltering profits from a company boasting a $10 billion investment portfolio seems somewhat duplicitous, at best.
(click here to continue reading Rauner Defends Dumping Dollars Into Off-Shore Accounts: Chicagoist.)
As we mentioned, the anti-moocher bill is finally going to be announced by Senator Durbin, though the odds of it passing through the House are slim, unfortunately…
Sen. Dick Durbin said he and other Democrats today will unveil a bill aimed at curbing corporate tax inversions. No federal contracts would go to businesses that engage in corporate inversions (moving headquarters overseas to lower tax bills), the Illinois Democrat said.
The measure is called the No Federal Contracts for Corporate Deserters Act.
The bill would mean no federal contracts would go to businesses that incorporate overseas, are at least 50 percent owned by U.S. shareholders and do not have substantial business opportunities in the foreign country in which they are incorporating. The law now defines a company as being “inverted” if it is at least 80 percent owned by U.S. shareholders after it reincorporates overseas, according to Durbin.
Drugmaker AbbVie of North Chicago is among the corporations that recently have announced they are “moving their mailbox overseas to avoid paying their fair share of taxes,” according to a statement from Durbin and the other Democrats. Deerfield-based Walgreen Co. also is considering such a move.
The others legislators involved are Sen. Carl Levin of Michigan and Reps. Rosa DeLauro of Connecticut and Lloyd Doggett of Texas, who are to appear today with Durbin at the news conference.
The White House estimates that nearly $20 billion in corporate taxes could be lost over the next 10 years because of the corporate merger deals known as inversions.
(click here to continue reading Durbin bill to target corporate inversions – chicagotribune.com.)
As we’ve discussed previously, we don’t know how this is considered acceptable behavior. Are the shareholder pressures on Walgreen Co. really so intense that the board would consider this drastic move to shave a few pennies off of their operating costs? Really? Maybe they should look to fire management, and find more competent oversight. Oh wait, Walgreen Co. CEO Greg Wasson was paid $13,700,000 last year. How about returning some of that to shareholders instead? Not to mention, per Walgreens “Net earnings for fiscal 2013 ended Aug. 31 determined in accordance with GAAP were $2.5 billion”. I guess that’s not enough. More, more, more…
The nation’s largest drugstore chain is considering a move that would allow it to significantly cut its tax bill and increase profits. But it’s being painted by critics as un-American for looking to make money for shareholders through financial engineering at the expense of the communities that it grew up in. Walgreen is considering a so-called corporate tax inversion, in which an American company is able to incorporate abroad by acquiring a foreign company. The buyer, in effect, becomes a subsidiary of a foreign parent.
The average person who pays taxes cannot take advantage of the tax loopholes exploited by corporations, and they don’t think it’s fair, said Klaus Weber, associate professor of management and organizations at Northwestern University’s Kellogg School of Management.
“I do think people now more than before care because of rising issues of income inequality and justice and the fact that large companies have come under more scrutiny,” Weber said. “People expect corporations to fulfill their citizen duties as taxpayers like everyone else.”
While several U.S. companies have moved to lower-tax countries since 2012, Walgreen has caught the attention of taxpayer groups and unions that have criticized the potential tax maneuver. They have blasted Walgreen for contemplating fleeing the United States even though it benefits from government insurance programs. Nearly one-quarter of Walgreen’s $72 billion in sales in its last fiscal year came from Medicaid and Medicare, according to a report by Americans for Tax Fairness and Change to Win Retail Initiatives, a union-backed group.
“It is unconscionable that Walgreen is considering this tax dodge — especially in light of the billions of dollars it receives from U.S. taxpayers every year,” Nell Geiser, associate director of Change to Win Retail Initiatives, said in a statement. “Walgreen should show its commitment to our communities and our country by staying an American company.”
(click here to continue reading Walgreen considers headquarters move – chicagotribune.com.)
Walgreen Co. is busily calculating the cost of moving corporate infrastructure, relocating executives and staff, and the very real risk of losing their Medicaid/Medicare cash cow, not to mention the also very real risk of consumer boycott to save a few percentage points of tax revenue. Sleazy, no? And ironic, since Medicaid and Medicare is responsible for about 21% of our national budget. Why should Walgreen’s get any of taxpayer money for it when they refuse to pay in?
Would shareholders care if Walgreen Co. was kicked out the the S&P 500? Probably, but Walgreens executives will get handsomely paid either way.
[The CtW Investment Group] said an inversion could hurt Walgreen’s stock price.
“Reincorporation carries risk of removal from the S.&P. 500 and other stock indices,” it said, citing the examples of Ace and Transocean, which were removed from the index after they moved to Switzerland. It added that some investors like big pension funds could be required to sell shares of the company if it were not included in the S.&P. 500-stock index.
If Walgreen reincorporated in Switzerland, where Alliance Boots is based, the influence of shareholders could be diminished, CtW said. Swiss law gives shareholders less protection, CtW said, making it harder for investors to seek remedies through courts in the event of fraud or a dereliction of board duties.
CtW also said it was sensitive to the brewing political debate about inversions. In recent months, several senators and President Obama have proposed legislation that would curtail the practice. No new laws are yet in place, but there is a belief on Wall Street that the window for such deals could close soon.
“In addition to the concerns outlined above, we fear that there could be political and reputational risks following an inversion, which would pose a clear contradiction with Walgreen’s quintessentially American brand,” CtW wrote. “Accordingly, we strongly urge you to end the controversy over Walgreen’s potential
(click here to continue reading Walgreen Shareholder Opposes Potential Deal to Reincorporate Abroad – NYTimes.com.)
Senator Dick Durbin is troubled by this cowardly plan as well:
As Walgreen Co, the largest U.S. drugstore chain, edged closer to potentially moving its tax home base abroad, the senior U.S. senator from its home state said on Wednesday that he hoped the company would not take such a step.
Illinois Democrat Richard Durbin told Reuters in an interview that he spoke with a Walgreen lobbyist on Tuesday. “I told him I hope that the rumor’s not true,” Durbin said.
Durbin, the Senate’s second-highest ranking Democrat, said Walgreen, now based in a Chicago suburb, would be ill-advised to pursue an “inversion” deal with Switzerland’s Alliance Boots Holding Ltd.
“Because of their national reach, they are a uniquely American company, and I think it would really hurt their image if they decided to give up on this country and to head overseas to make a couple extra dollars,” he said.
(click here to continue reading Exclusive: U.S. senator warns as Walgreen weighs overseas tax deal | Reuters.)
and despite the Patriot Employer Tax Credit Act bill having a slim chance of passing through the reactionaries in the US House, Sen. Durbin is at least trying:
Sen. Richard Durbin said Monday he will introduce legislation this week that would close tax loopholes for corporations that take jobs out of the country.
Durbin announced the “Patriot Employer Tax Credit Act” at Wheatland Tube in the Back of the Yards neighborhood. He plans to introduce the measure Thursday, a spokeswoman said.
The proposal would give tax credits to companies “that provide fair wages and good benefits to workers while closing a loophole that allows corporations to claim tax savings for activities such as building a manufacturing plant overseas,” according to a news release from Durbin’s office.
To qualify for the credits, a company must maintain its corporate headquarters in the U.S., maintain the same number or increase the number of U.S. workers compared with the number overseas and provide health insurance benefits that comply with the Affordable Care Act.
(click here to continue reading Durbin bill would close tax loopholes for corporations sending jobs overseas – chicagotribune.com.)
Words I didn’t expect to type in the 21st C.E., “Good for Sting!”. If only Sam Walton had been as insistent upon his progeny finding their own way, or Donald Trump’s father…
Sting’s children cannot expect to inherit his multimillion-pound wealth, the rock star has said, joining the ranks of the super-rich who have claimed that passing on their vast fortunes to their offspring could do more harm than good.
The 62-year-old musician, who is estimated to be worth £180m and has three sons and three daughters, said he did not want “to leave them trust funds that are albatrosses round their necks”.
“They have to work,” he told the Mail on Sunday’s Event magazine . “All my kids know that and they rarely ask me for anything, which I appreciate. Obviously, if they were in trouble I would help them, but I’ve never really had to do that. They have this work ethic that makes them want to succeed on their own merit.”
Sting insisted there would in fact not be a huge fortune left for his children, who are aged between 18 and 37.
“I told them there won’t be much money left because we are spending it,” he said. “We have a lot of commitments. What comes in we spend, and there isn’t much left.”
(click here to continue reading Sting: My Children Won’t Inherit My Wealth – Business Insider.)
Speaking of estates, a couple years ago, my parents mentioned that they’ve executed their will, splitting their estate three ways between my brother, my sister and me, with my sister getting 34%. We are lucky in that we get along well, and that the amount we are talking about is certainly less than $2,000,000…
Some other wealthy folks of note also doing the right thing:
Bill Gates, the world’s richest man, has said that his children could not expect to inherit the vast majority of his estimated $76bn fortune.
“They won’t have anything like that. They need to have a sense that their own work is meaningful and important,” he has been quoted as saying. “You’ve got to make sure they have a sense of their own ability and what they’re going to go and do.”
Simon Cowell, the music mogul whose son Eric was born earlier this year, has said he will most likely leave his estimated £225 million fortune for charity, explaining: ““I don’t believe in passing on from one generation to another.”
British celebrity chef Nigella Lawson has said she was “determined” that her children should have no financial security as “it ruins people not having to earn money”.
Anita Roddick, the Body Shop founder, left her entire £51m fortune to charity after describing leaving money to one’s own family as “obscene”.
…And John Roberts, the chief executive of white goods retailer ao.com, has said he will not pass his estimated £500m wealth to his children, in order that they could have normal lives and a sense of achievement.
More data about the need for estate reform in the US
she requested a copy of the will. It turns out her grandmother, who was suffering from severe Alzheimer’s, had signed a will in September 2012 that reaffirmed a 2007 will that split her assets among her five children, with her son’s share going to his children. Five days later — and a week before she died — the grandmother signed another will that disinherited her son’s children.
…And it raised common competing issues in these cases: Grandma may have had diminished capacity or been swayed by her daughters, he said. “But judges work very hard to protect individual rights to dispose of their property as they wish.”
The bar to overturn a will is high. “The capacity needed to make a will is very low, lower than to enter into a legal contract,” said Adam von Poblitz, head of estate planning for Citi Private Bank. “You could have someone who had dementia, but if they had moments of lucidity they could execute a fully valid will.”
For Kate, it wasn’t only about the money but about how her aunts treated her. “They started calling us greedy from the beginning,” she said.
Disinheriting family members is an extreme step and one that is not even allowed in many countries. John Davis, faculty chairman of the families in business program at Harvard Business School, has studied inheritance laws around the world and found that in most places people have limited discretion over leaving money to heirs.
“Whether it’s sharia in Muslim countries or the Napoleonic Code throughout Europe and parts of Latin America, what you give to your heirs is tightly prescribed,” Mr. Davis said. “Anglo-Saxon countries are the exception to this rule.”
In reality, Mr. Davis said, unequal inheritance is rare even in the United States, though he often advocates for it to be used more, particularly when a family business is involved.
(click here to continue reading When a Will Divides an Estate, and Also Divides a Family – NYTimes.com.)
All too frequently the lawyers are the ones who end up with the bulk of the inheritance, especially in cases where litigation is involved. Not to mention, the estate always seems to be smaller than anticipated by the aggrieved parties…
If I was in charge of tax policy, instead of lowering the estate tax as so many rich schmucks are constantly yammering about, I’d raise it to 90% on all estates valued at greater than $2,000,000. Why can’t these parasites make their own fortunes? and even being able to gift 10% of your multi-billion dollar estate is more than enough to live comfortably…
Here are some reasons why.
SC Johnson, the “family” company’s billionaire heir, Samuel Curtis Johnson III, who confessed to repeatedly sexually assaulting his teenage stepdaughter has received an outrageous prison sentence of only four months because the judge, Circuit Justice Eugene Gasiorkiewicz, feels that Johnson’s importance to the community is valued much higher than the dignity of his abused step-daughter.
Affluenza, as it has been dubbed, has struck again. This billionaire has officially plead guilty to mere misdemeanor charges of fourth-degree sexual assault and disorderly conduct instead of receiving the maximum which is felony sexual assault on a minor child. These charges originally stem from 2011. Think Progress reported Johnson’s stepdaughter “initially told police Johnson was ‘a sex addict‘ and touched her inappropriately 15 to 20 times starting when she was 12 years old. She told her mother about the abuse in order to protect her younger sister, and Johnson confessed when the mother confronted him.” Because Johnson’s victim was unwilling to testify in the case, the prosecutors had to make a plea deal with Johnson and his legal team.
(click here to continue reading – Billionaire Gets 4 MONTHS For Sexually Assaulting 12-Year-Old Because He’s ‘Productive’.)
A Delaware man convicted of raping his three-year-old daughter only faced probation after a state Superior Court judge ruled he “will not fare well” in prison.
In her decision, Judge Jan Jurden suggested Robert H. Richards IV would benefit more from treatment. Richards, who was charged with fourth-degree rape in 2009, is an unemployed heir living off his trust fund. The light sentence has only became public as the result of a subsequent lawsuit filed by his ex-wife, which charges that he penetrated his daughter with his fingers while masturbating, and subsequently assaulted his son as well.
Richards is the great grandson of du Pont family patriarch Irenee du Pont, a chemical baron.
According to the lawsuit filed by Richards’ ex-wife, he admitted to assaulting his infant son in addition to his daughter between 2005 and 2007. Richards was initially indicted on two counts of second-degree child rape, felonies that translate to a 10-year mandatory jail sentence per count. He was released on $60,000 bail while awaiting his charges.
(click here to continue reading One Percenter Convicted Of Raping Child Dodges Jail Because He ‘Will Not Fare Well’.)
Ethan Couch, the Texas teen whose deadly drunk driving was excused by a lenient judge because of “affluenza,” is serving his time in rehab on mostly taxpayers’ money, RadarOnline reports. According to RadarOnline, it is largely the public who will be responsible for the now 17-year-old’s $438,000-per-year rehab treatment.
“Recently a judge ruled that the teen should be sent to North Texas State Hospital in Vernon. The hospital’s rehab program charges $700 a day, but since it is a partially state-funded institution, Couch’s parents would only be charged $38 per day for their son’s treatment,” Kenneth Webster, a contributor to Breitbart.com, said, according to the news site. “Thanks to taxpayers, Couch’s rehab bill has been dropped from $438,000 annually to only $13,870.”
That seems a small fee for the affluent family, who have been sued for millions of dollars by the families of those killed in the drunk-driving accident, as well as by those injured.
Last year Couch decided to take a drunken joy ride in his pickup truck after a party. He crashed into the car of Breanna Mitchell, whose car had stalled, killing her and three others who were trying to help her. Another teen boy who was in the pickup with him, Sergio Molina, was thrown from the vehicle. He landed on his head and was left paralyzed, with only the ability to smile and blink. Molina’s family settled with Couch’s family in early May.
(click here to continue reading Report: Taxpayers Footing Rehab Bill for ‘Affluenza’ Teen – The Root.)
and then there are these stains:
As it turns out, the first generation led by patriarch Sam Walton put $4.7 billion into the foundation, a figure that represents 98.8 percent of all family donations over the past 23 years. The six Scrooges of the second Walton generation ponied up only 1.2 percent. Alice Walton, one of the faces of Mitt Romney’s 2012 SuperPAC, has given zero. With over $2 billion in assets, the Walton Family Foundation distributed $325 million in 2013. Those dollars went overwhelmingly to their stomping grounds in northwest Arkansas, funding environmental improvements, pet education reforms including charters schools and vouchers and, as Forbes reports, “Alice Walton’s stunning Crystal Bridges Museum of American Art.”
For starters, for decades the Waltons have relied on a tax dodge that now bears their name to keep billions of dollars from Uncle Sam. The Walton grantor-retained annuity trust, or Walton GRAT, has allowed billionaires like the Walmart heirs and casino mogul and GOP bag man Sheldon Adelson to shield $100 billion from the IRS since 2000. Named after the tactic lawyer Richard Covey, the dodge was developed for Sam Walton: GRATs work by rapidly shifting large volumes of stock into a trust fund that is legally required to return that initial investment after two years. The stocks in the trust gain enough value that when it comes time to repay the initial investment there is a substantial amount of stock left over that can be transferred on to some third party without triggering the gift tax.
(click here to continue reading The Walmart heirs should save Detroit.)
(click here to continue reading The Walmart heirs should save Detroit.)
In 2013 alone, the Foundation invested $325 million across three key areas: education reform, the environment and the family’s home region of northwest Arkansas. One of the Foundation’s major recipients has been Alice Walton’s stunning Crystal Bridges Museum of American Art, funded to the tune of $1.2 billion.
However, almost none of this largesse is the result of donations from the Waltons themselves, according to a report released on Tuesday by Walmart 1 Percent, a project of union-backed Making Change at Walmart.
The central finding of this report is simple: Our analysis of 23 years’ worth of the Walton Family Foundation’s tax returns shows that Rob, Jim, Alice and Christy Walton—the second generation Walmart heirs—have contributed almost none of their personal fortune to the foundation which bears their family name.
– Rob and Alice Walton made zero individual contributions to the Foundation during the 23 years we examined;
– Jim Walton made a single personal contribution of $3 million to the Walton Family Foundation, more than 15 years ago;
– Rob, Jim, and Alice Walton and the family holding company they control (Walton Enterprises) have been responsible for only .13% of all contributions to the Walton Family Foundation ($6.4 million);
– Among the second generation Walton heirs, it is the in-law, Christy, who has been responsible for the largest share of contributions to the Foundation;
– The four Walmart heirs and Walton Enterprises combined have been responsible for only 1.2% of all contributions to the Walton Family Foundation.
The combined lifetime contributions of the second generation Walmart heirs and their family holding company to the Walton Family Foundation come to $58.49 million, or:
■■ About .04% of the Waltons’ net worth of $139.9 billion;
■■ About .34% of the estimated $17.1 Billion in Walmart dividends that Rob, Jim, Alice and Christy received during the years we analyzed;
■■ Less than one week’s worth of the Walmart dividends the Waltons will receive this year;
■■ Less than the estimated value of Rob Walton’s collection of vintage sports cars.
The report goes on to detail how the Foundation has been funded over the years, namely by tax-avoiding trusts established with assets provided by the late Sam, Helen and John Walton or their estates. The study found that 99% of the Foundation’s contributions since 2008 have been channeled through 21 Charitable Lead Annuity Trusts. These CLATs, as they’re known, are specifically designed to help ultra-wealthy families avoid estate and gift taxes.
If the rich keep using their wealth and power to take from the rest of us, when will it end? If entitled assholes like the ones mentioned here get their way, and Social Security, Medicare, and other entitlement programs become insolvent because little S.C. Johnson the Third refuses to participate in our democracy, what then? Will a guillotine be required eventually?
Tax breaks are sacrosanct, responsible budgets be damned…
The next time a Republican even comes near climbing aboard the deficit cross, you have permission to laugh in their face. The party of paying for things has proposed $310 billion in permanent, unpaid for tax provisions today.
The party of austerity for children, veterans, the elderly, and the sick claimed they were only cutting people off in order to be “Responsible with the Deficit”. This is the same deficit that they told us didn’t matter when they were in charge, but after they fled responsibility in the wake of the 2008 crash as a Democratic President took office to clean up their mess, suddenly the deficit was all Republicans could think about. So sorry about your starving baby, but the DEFICIT.
The DEFICIT is the number one priority, they somberly and relentlessly intoned any time they got near a microphone.
And yet today, Republicans proposed tax provisions without offsets that Ranking Member Sander Levin (D-MI) points out would add “a combined $310 billion to the deficit,” which “represents more than half of the entire federal deficit this year.”
(click here to continue reading GOP Hypocrites Busted For Trying to Add $310 Billion to the Deficit Via Tax Breaks.)
watch the statement yourself…
Walgreen Co. is allegedly considering relocating its headquarters from Deerfield, IL to somewhere in Europe, probably Switzerland, perhaps Paris to avoid contributing extra dimes to our national good. Shareholders are more important than schools and roads, never forget.
In a twist on economic globalization less obvious than moving factories overseas, a small but growing number of corporations have relocated headquarters to Europe to escape the 35 percent tax on U.S. profits, the highest in the developing world.
Walgreen Co., the nation’s largest drugstore chain, is under pressure from some shareholders to move its headquarters to Europe, where it owns nearly half of Swiss-based pharmacy giant Alliance Boots.
Deerfield-based Walgreen has called Illinois home for all its 113 years.
Though a move would make financial sense for Walgreen and its investors, it’s an executive decision fraught with political risk for a company as high profile as the pharmacy chain, analysts said Monday after news leaked that Walgreen and investors discussed the possibility.
Walgreen plays an integral role in the U.S. health care system, dispensing drugs to millions of consumers through its more than 8,000 stores. A significant portion of its $72 billion in annual sales comes from Medicare, the federal government’s insurance program for the elderly.
(click here to continue reading Investor group pressures Walgreens to move HQ to Europe – Chicago Tribune.)
Not mentioned in this Chicago Tribune (Republican) article is that most U.S. corporations pay much, much less than the 35% corporate tax rate often cited. Loopholes, deductions add up to reduce corporate taxes in a way that an individual tax filer can never hope to replicate.
The biggest, most profitable American companies paid only a fraction of the taxes they would owe under the official corporate rate, according to a study released on Monday by the Government Accountability Office.
Using allowed deductions and legal loopholes, large corporations enjoyed a 12.6 percent tax rate far below the 35 percent tax that is the statutory rate imposed by the federal government on corporate profits.
The report found that even when foreign, state, and local taxes were included, the tax rate of large companies rose only to 16.9 percent of total income, still well below the official 35 percent.
“Some U.S. multinational corporations like to complain about the U.S. 35 percent statutory tax rate, but what they don’t like to admit is that hardly any of them pay anything close to it,” Mr. Levin said in a statement. “The big gap between the U.S. statutory tax rate and what large, profitable U.S. corporations actually pay is due in large part to the unjustified loopholes and gimmicks that riddle our tax code.”
(click here to continue reading Big Companies Paid a Fraction of Corporate Tax Rate – NYTimes.com.)
Now, if Walgreen Co. pays 35% in tax, and the rest of their competitors pay only 12.6% or similar, than perhaps Walgreen’s should hire a few accountants before moving their entire operations to socialist1 Europe. I’d hazard a guess that Walgreen’s has as good of accountants and tax lawyers as any other U.S. corporation, and thus is not paying 35% of its income in tax.
Also, I don’t see how Walgreen Co. could depend upon maintaining its Medicare cash-cow if it was a non-US corporation. That would not play well during election season.Footnotes:
- kidding, kidding, of course [↩]
We’ve been following this story for a while, so an update from Phil Rosenthal and Ray Long:
Archer Daniels Midland, unable to secure the special tax incentives it sought from Illinois legislators, nonetheless announced Wednesday that it will go forward with its plan to move its world headquarters to Chicago from Decatur, Ill.
The agriculture giant said it plans to locate 50 to 75 executives in Chicago to a site that has not yet been selected. That’s down from the 100 jobs the company originally cited in its bid to win Springfield approval for special payroll tax incentives worth up to $30 million over 20 years.
“While we considered other global hubs, Chicago emerged as the best location to provide efficient access to global markets while maintaining our close connections with U.S. farmers, customers and operations,” said ADM Chairman and CEO Patricia Woertz said in a statement Wednesday morning. “Chicago also provides an environment where we can attract and retain employees with diverse skills, and where their family members can find ample career opportunities.”
The politicians who opposed a cash-strapped state giving a $1.5 million annual tax break to a company with a market cap of more than $27 billion can claim they held their ground. But absent the incentives package, ADM would not have to make assurances about ongoing staffing levels.
(click here to continue reading ADM to move headquarters to Chicago – chicagotribune.com.)
Like I said before, talented executives want to live in a place that’s interesting, in a city that has culture, restaurants, and so on. If free money is offered, of course corporations are going to take it, but without it? They would still rather live somewhere where nightlife consists of more than just Wednesday night bingo.
It appears that ADM has a robust enough business that they don’t need corporate welfare to stay in business after all, in contrast to the barely above-water Office Depot/OfficeMax corporation, which decided to keep its HQ in Florida.
Office Depot said Tuesday it has chosen Boca Raton, Fla. for its new headquarters over Naperville.
Office Depot completed its merger with Naperville-based OfficeMax last month, but the pair hadn’t yet announced where the combined company would be based.
The companies asked for tax breaks from both states. Illinois lawmakers adjourned last week before making a decision.
(click here to continue reading Office Depot picks Florida over Illinois for new headquarters – Chicago Tribune.)
A cynic might note that Office Depot was the purchaser of OfficeMax, and Office Depot’s HQ was already located in Florida, thus any discussion of moving to Illinois was mostly about leverage to shake down the State of Florida for tax breaks. Also, for what its worth, Florida doesn’t have a state income tax, a fact overpaid executives are probably well aware of.
One last point, ADM might have negotiated a back-room deal with Illinois politicians – the tax incentives might miraculously show up during next year’s legislative session, we’ll have to continue to pay attention.
I’ve long suspected this to be true:
When Motorola Mobility lined up a Silicon Valley candidate a few months ago for a VP-level role, the phone maker was hopeful he’d accept. After all, the company offered the chance to develop products at a subsidiary of Google Inc.
The engineer declined. His reason: the prospect of relocating to Libertyville, Ill., about 35 miles from downtown Chicago, said Scott Sullivan, Motorola’s head of human resources.
Mr. Sullivan expects recruiting to get a lot easier next February when the company moves into a new space in the storied Merchandise Mart building in downtown Chicago.
Motorola will join United Continental Holdings Inc., Hillshire Brands Co. —the successor to Sara Lee Corp.— and other corporate giants abandoning vast suburban campuses for urban offices nearer to the young, educated and hyper-connected workers who will lead their businesses into the digital age. Archer Daniels Midland Co. recently said it would move its headquarters from Decatur, Ill., and in the Bay Area, startups like Pinterest Inc. are departing Silicon Valley for San Francisco.
After decades of big businesses leaving the city for the suburbs, U.S. firms have begun a new era of corporate urbanism. Nearly 200 Fortune 500 companies are currently headquartered in the top 50 cities. Many others are staying put in the suburbs but opening high-profile satellite offices in nearby cities, sometimes aided by tax breaks and a recession that tempered downtown rents. And upstart companies are following suit, according to urban planners. The bottom line: companies are under pressure to establish an urban presence that projects an image of dynamism and innovation.
(click here to continue reading Companies Say Goodbye to the ‘Burbs – WSJ.com.)
which makes it more puzzling why governments (state, city both) dangle tax breaks to encourage corporations to relocate. The truth is the executives much rather would live in vibrant cities, not B.F.E. rural Alabama for the most part. The employees would rather live in a place that is fun to live in, a place with culture, award-winning restaurants, recreation, and even sports teams. As a totally random example, Sinead O’Connor came through Chicago, playing for a few days at the City Winery. Do you think she’s playing in Gulfport, Mississippi? Or Decatur, IL? So why does ADM, for instance, stamp its feet for a tax break from a state that’s already operating at a deficit? Happily, the Illinois House adjourned before granting payola graft to ADM, though the IL Senate passed their version of this travesty, right before cutting pensions for teachers.
Two bills that would grant special tax breaks for three companies have stalled until state lawmakers return here in the spring. The bills, aimed at allowing Archer Daniels Midland, Office Depot, and Univar to retain withholding taxes that would go to the state, passed the Senate during a one-day special session Tuesday. But the House adjourned, stalling the bills.
All three companies have said they are considering proposals from other states.
“We appreciate the support of the senators who voted for the bill, especially the leadership of Sen. (Andy) Manar. Given that the House did not act, we will review our options. We expect to make an announcement soon,” Jackie Anderson, an ADM spokeswoman, said in a statement.
…Office Depot and Univar declined to comment.
Had the bills been approved, the incentives would have cost the state an estimated $88 million.
Unions, which opposed the plan to deal with worker pensions, criticized the incentives bills.
“At a time when Illinois is a chronic deadbeat and critical resources such as education, public safety and healthcare remain woefully under-funded, our elected representatives today voted to sink the state further into red ink by absolving some of its richest corporations from paying their fair share in taxes,” Keith Kelleher, president of SEIU Healthcare Illinois, Indiana, Missouri and Kansas, said in a statement.
Office Depot, chemical distributor Univar and agriculture giant ADM are among at least a half-dozen companies seeking special state legislation to keep their employees’ tax withholdings instead of forwarding them to the state. The companies want the special breaks because they have years in which they have little or no state corporate tax liability and can’t take advantage of state tax breaks awarded to spur economic development.
(click here to continue reading Tax breaks for Office Depot, Univar inch closer to approval – chicagotribune.com.)
Yeah, I’d rather Office Depot and A.D.M. have strong enough businesses that they could survive without resorting to corporate welfare…
We’re pleased to announce that the Amazon Associates program is again open to residents of the State of Illinois. We’re now able to re-open the program because the Illinois State Supreme Court recently struck down legislation that had forced Amazon to close the program to residents of Illinois. Amazon strongly supports federal legislation like the Marketplace Fairness Act that’s now pending before Congress, which is the only constitutional way to resolve interstate sales tax collection issues.
Residents of Illinois who would like to participate in the Amazon Associates program can submit an application here:
Thanks for your past participation in the Amazon Associates program. We hope to see you again soon.
Well that was a big circle around the campfire…