Bramwell's Lunch Beat: Hans Unimpressed, SEC Oil Slick, Retailers’ Tax Pleaby
International accounting regulators not doing cartwheels over SEC's idea
The chairman of the International Accounting Standards Board (IASB) isn't thrilled with the US Securities and Exchange Commission's (SEC) middle-ground approach to moving the United States toward using global accounting rules, wrote Michael Rapoport of the Wall Street Journal. The SEC is mulling a recommendation from its staff to allow US companies to provide information under the global rules as an add-on to their main financial statements, which would still be calculated under US accounting rules. But IASB Chairman Hans Hoogervorst says the SEC's idea wouldn't actually prompt significantly greater US use of the global rules because companies think they already have to disclose too much and are trying to reduce the volume of their disclosures, not increase it. âI don't think many [companies] will be jumping up and down to see this as an additional disclosure,â Hoogervorst said at an accounting conference on Thursday.
Billions of barrels of oil vanish in a puff of accounting smoke
Asjylyn Loder of Bloomberg wrote that oil companies like Chesapeake Energy Corp., founded by fracking pioneer Aubrey McClendon, pushed the SEC for an accounting change in 2009 that made it easier to claim reserves from wells that wouldn't be drilled for years. Inventories almost doubled and investors poured money into the shale boom, enticed by near-bottomless prospects. But the rule has a catch: It requires that the undrilled wells be profitable at a price determined by an SEC formula, and they must be drilled within five years. Time is up, prices are down, and the rule is about to wipe out billions of barrels of shale drillers' reserves. The reckoning is coming in the next few months, when the companies report 2015 figures. The rule change will cut Chesapeake's inventory by 45 percent, regulatory filings show.
Retailers oppose customs bill over lack of online sales tax provisions
Vicki Needham of The Hill wrote that the National Retail Federation (NRF) is urging lawmakers to reject a customs enforcement bill unless an online sales tax provision is added. The group said on Thursday that online sellers have an advantage over brick-and-mortar stores and changes must be made to ensure the same tax policy is applied across all merchants â whether local or on the Internet. âIt is time for Congress to remove the sales tax advantage for Internet sellers that is harming our communities,â said David French, NRF's senior vice president, in a letter to Congress on Thursday. Retailers had hoped to use the customs measure as a vehicle for the sales tax bill, which has been in the works for more than a decade. The customs bill already includes another tax provision that would make permanent a federal ban on Internet access taxes, which is set to expire on Friday. Retailers argue there should be room to attach their tax proposal as well.
Medical device tax hinders industry growth, new report says
Medical device company executives say the federal medical device excise tax has negatively affected their companies through job reductions, reduced research and development spending, and increased tax compliance burdens, according to a Massachusetts Medical Device Industry Council survey released on Thursday, wrote Jessica Geller in an article for the Boston Globe. Twenty-three respondents said their companies have reduced employment by up to 25 percent as a result of the medical device excise tax, which was implemented in 2013 as part of the Affordable Care Act to raise $38 billion over the next 10 years. The 2.3 percent tax is imposed directly on medical device manufacturers, producers, and importers. About 71 percent of survey participants said they had slowed or halted overall US job creation because of the medical tax.
- Congress pushes for delay in âCadillac tax' on health plans (Wall Street Journal)
- Unintended consequence of âCadillac tax': Taxing those most in need of care (The Hill)
- Taxpayers, states win when there's tax code competition (The Hill)
- It's official: The Bush tax plan loses trillions and worsens inequality (Washington Post)
- Clinton's plan to complicate corporate taxes (Bloomberg View)
- Hillary Clinton proposes tough new curbs on corporate tax inversions (TaxVox)
- Corporate tax inversions are only part of the problem (TaxVox)
- Reforming the Child Tax Credit for low-income workers (TaxVox)
- Norquist: Beware state legislators seeking limitless tax authority (Huffington Post)
- What makes Delaware an onshore tax haven (Tax Justice Blog)
- How Congress keeps saving the tax system from Treasury and the IRS (Tax Analysts)