Growing up, my family members often noted some aspect of daily life—how gas is cheaper if you pay in cash, or how it’s better to leave a server’s tip on the table rather than at the register—and said with a wave that it was “probably a tax thing.”
I used to be skeptical: “I’m not sure UNICEF is taking donations in dimes to dodge some tax ramifications of the quarter, Dad.” As I’ve become more familiar with tax policy, however, I’ve begun to think the adage might be more right than wrong.
Take the photographs of missing children printed on milk cartons during the ’80s and ’90s.
Milk carton manufacturers didn’t put those pictures on containers because “a missing kid is one less milk consumer,” as my grandfather suggested. Instead, they were taking advantage of tax breaks for participating in the National Child Safety Council program.
The details seem lost to history, but a decent guess is that carton manufacturers likely wrote off the cost of printing the photographs and biographies. The NCSC provided all the material on the missing children, so it was effectively a zero-cost purchase of consumer good will.
We here at Bloomberg Tax know that it is always probably a tax thing, as there’s a tax angle to nearly every story. But we’ll do our best to explain it to you with more than a passing wave.
The Exchange—It’s where great ideas intersect.
—Andrew Leahey
Look for Leahey’s column on Bloomberg Tax, and follow him on Mastodon at @andrew@esq.social
State Insights
Corporate and tax attorney Marina Vishnepolskaya explains the impact that the New York LLC Transparency Act will have on limited liability companies formed both in and outside New York.
Federal Insights
The IRS’s proposed rules on microcaptive insurance impose illogical requirements and contradict both congressional intent and the IRS’s own decisions, says Van Carlson of SRA 831(b) Admin.
Brady Williams of the McCombs School of Business looks at the need for policymakers to set clear standards on tax incentive packages for businesses.
Gunster’s Alan Lederman reviews a proposed federal excise tax on the acquisition of US agricultural land by citizens of or companies domiciled in a country of concern.
Greenberg Glusker’s Hanspeter Misteli Reyes reviews the conditions for being considered a US domiciliary or non-domiciliary and compares estate tax liability for both categories.
Global Insights
Adopting a carbon border adjustment mechanism would help US manufacturers avoid potential EU carbon tariffs and encourage production of low-carbon alternatives, says Project Canary’s Chris Romer.
Robert Risse of WU Executive Academy explains the benefits and drawback of AI in tax technology and compliance, and outlines five key lessons for business leaders to consider now.
The UK government is engaging in extensive consultation on modernizing and clarifying the rules on transfer pricing, permanent establishment, and diverted profits tax. Phil Roper and Tim Sarson of KPMG look at the details.
The OECD’s latest document on the status of Pillar One rules contains little new information, Jeff VanderWolk of Squire Patton Boggs says, as he discusses some of the implications.
Alfredo Collosa explains the OECD’s recent initiative on cryptoasset reporting and welcomes it as a positive move toward progress in international cooperation.
After value-added tax recently celebrated its 50th birthday in the UK, Rob Janering of Crowe considers the changes and challenges likely to develop in the next few years and what these will mean for businesses.
Columnist Corner
Two class action lawsuits were recently filed against OpenAI over scraped private data and copyrighted books. In this week’s Technically Speaking, Andrew Leahey writes that a flexible tax on AI mechanisms such as ChatGPT would recapture value generated by unidentifiable creators of media.
Career Moves
Greg Nelson has joined Gibson Dunn as a senior counsel with the tax practice group.
Kaitlyn L. Mariano and Samuel T. Walsh have been promoted to senior tax manager and tax senior, respectively, at Dannible & McKee in Syracuse, N.Y.
Curtis Ruppal has been named the group managing partner of tax at Plante Moran in Grand Rapids, Mich.
David C. Moseman, who is a CPA, has been promoted to partner in charge of tax services for CironeFriedberg.
Derek M. Winokur and Edward P. Lemanowicz have joined Milbank as partners in the New York office.
Scott Schapiro has joined Aprio as a partner leading the employment tax and payroll employee retention credits teams in Atlanta.
Bryan Howard has joined Holland & Knight as a partner in the private wealth services group in Nashville.
Spotlight
This week’s Spotlight is on Simcha David, a tax attorney who is a partner at EisnerAmper’s Eisner Advisory Group in New York City. His practice focuses on financial services and investment management entities, and he advises on all aspects of tax planning and compliance for financial services firms and their related entities.
News Roundup
It’s been another busy week in tax news from state capitals to Washington. Here are some stories you might have missed from our Bloomberg Tax news team.
*Note: Your Bloomberg Tax login is required to access Tax News.
- Tax and law firms are expanding to meet the growing demand of clean energy and corporate clients vying to get a piece of the billions of dollars of tax credits in the tax-and-climate law.
- The Biden administration secured an extension of a worldwide freeze on new digital taxes, putting it on a collision course with Canada after Ottawa refused to endorse the deal.
- Senators looking for a solution on how to alleviate double taxation imposed on US and Taiwanese companies are considering how to square reconcile bipartisan bills moving through Congress.
- The IRS is taking “swift and aggressive action” to strengthen enforcement efforts against high-income individuals as it starts to use the funding it received in the tax-and-climate law, IRS Commissioner Danny Werfel said.
The Altamont Pass wind farm past mustard flowers outside Tracy, California on April 6, 2023.
Photographer: David Paul Morris/Bloomberg via Getty Images
Tax Journals
In a Tax Management International Journal analysis, Monique van Herksen and Clive Jie-A-Joen of Simmons & Simmons, Jolanda Schenk of Shell Netherlands, and Marc Levey of Baker McKenzie analyze the global commitment to reduce greenhouse gas emissions and the need for international coordination so companies and investors have clear and consistent treatment for tax and transfer pricing.
In another Tax Management International Journal analysis, Stephen Peng and Rebecca Burch of EY report on significant bills introduced in the 117th Congress that would affect international provisions of the Internal Revenue Code.
The Wagner Law Group’s Michael Schloss, who spent more than 30 years at DOL enforcing ERISA, reflects on retirement policies that except ERISA’s primary fiduciary requirements for tax-subsidized plan assets while promoting employee stock ownership as well as environmental and social goals, and barring investments in firms tied to U.S. adversaries.
*Note: Your Bloomberg Tax login is required to access Tax Journal articles.
Our Wish List
With 46 states starting their fiscal year on July 1, we’re looking for Insights that focus on what tax professionals should know about the most recent changes in state and local taxes. We’d also like pieces about the shifting landscape for state digital taxes.
If you have an interesting, never-published article for publication, you can contact our Insights team by email at TaxInsights@bloombergindustry.com.
Our Team
We talk about tax a lot. But there’s much more that you might hear us talking about if you popped into one of our Teams meetings. Here’s a quick look at what some of us are watching, reading, and listening to this week.
Watching
Maria Menezes (Practice Lead): Wimbledon, Wimbledon, and more Wimbledon…
Reading
Melanie Cohen (Content Editor): “The Whiteness of Wealth” by Dorothy Brown—I’ve wanted to read it ever since she was interviewed on the Talking Tax podcast!
Listening
Andrew Leahey (Columnist): I’ve been listening to a great podcast series, “The History of Philosophy Without Any Gaps.” Philosophy is one of those areas that I have only a smattering of knowledge about, and what better way to improve on that than to have it presented to me without any gaps?
Stay Connected
Sign up for your free copy of our newsletter delivered to your inbox each week. Just head over to The Exchange and sign up using the green “Free Newsletter Signup” box at the top—or just go directly to the newsletter sign-up page.
Follow Bloomberg Tax on Twitter, Facebook, Instagram, LinkedIn, and Threads—and check out Bloomberg Law on TikTok. We also have a growing LinkedIn group where our authors, contributors, and readers can share tax-related stories and exchange ideas. We hope you’ll join the conversation!
————————————————
