Tax-Optimal Step-Up and Imperfect Loss Offset

In the field of mergers and acquisitions, German and international tax law allow for several opportunities to step up a firm's assets, i.e., to revaluate the assets at fair market values. When a step-up is performed the taxpayer recognizes a taxable gain, but also obtains tax benefits in the form of higher future depreciation allowances associated with stepping up the tax base of the assets. This tax-planning problem is well known in taxation literature and can also be applied to firm valuation in the presence of taxation. However, the known models usually assume a perfect loss offset. If this assumption is abandoned, the depreciation allowances may lose value as they become tax effective at a later point in time, or even never if there are not enough cash flows to be offset against. This aspect is especiallyrelevant if future cash flows are assumed to be uncertain. This paper shows that a step-up may be disadvantageous or a firm overvalued if these aspects are not integrated into the basic calculus. Compared to the standard approach, assets should be stepped up only in a few cases and - under specific conditions - at a later point in time. Firm values may be considerably lower under imperfect loss offset.

The Optimal Capital Structure of Banks: Balancing Deposit Insurance, Capital Requirements and Tax-Advantaged Debt

The capital structure and regulation of financial intermediaries is an important topic for practitioners, regulators and academic researchers. In general, theory predicts that firms choose their capital structures by balancing the benefits of debt (e.g., tax and agency benefits) against its costs (e.g., bankruptcy costs). However, when traditional corporate finance models have been applied to insured financial institutions, the results have generally predicted corner solutions (all equity or all debt) to the capital structure problem. This paper studies the impact and interaction of deposit insurance, capital requirements and tax benefits on a bankÇs choice of optimal capital structure. Using a contingent claims model to value the firm and its associated claims, we find that there exists an interior optimal capital ratio in the presence of deposit insurance, taxes and a minimum fixed capital standard. Banks voluntarily choose to maintain capital in excess of the minimum required in order to balance the risks of insolvency (especially the loss of future tax benefits) against the benefits of additional debt. Because we derive a closed- form solution, our model provides useful insights on several current policy debates including revisions to the regulatory framework for GSEs, tax policy in general and the tax exemption for credit unions.

Tax Motivated Takings

Tax motivated takings are takings by a local government aimed purely at increasing its tax base. Such an action was justified by the Supreme Court's ruling in Kelo v. New London, which allowed the use of eminent domain for a private redevelopment project on the grounds that the project promised spillover public benefits in the form of jobs and taxes. This paper argues that tax motivated takings can lead to inefficient transfers of land for the simple reason that assessed values understate owners' true values. We therefore propose a reassessment scheme that greatly reduces the risk of this sort of inefficiency.

Tax Collection in History

Methods of tax collection employed by modern governments seem dull when compared to the rich variety observed in history. Whereas most governments today typically use salaried agents to collect taxes, various other types of contractual relationships have been observed in history, including sharing arrangements which divide the tax revenue between the government and collectors at fixed proportions, negotiated payment schemes based on the tax base, and sale of the revenue to a collector in exchange for a lump-sum payment determined at auction. We propose an economic theory of tax collection that can coherently explain the temporal and spatial variation in contractual forms. We begin by offering a simple classification of tax collection schemes observed in history. We then develop a general economic model of tax collection that specifies the cost and benefits of alternative schemes and identifies the conditions under which a government would choose one contractual form over another in maximizing the net revenue. Finally, we use the conclusions of the model to explain some of the well-known patterns of tax collection observed in history and how choices varied over time and space.

Behavioral cognitions and factors related to hepatitis B vaccine acceptance and compliance in a cohort of drug users in Houston, Texas

Purpose. Drug users are a large group of those at highest risk for contracting Hepatitis B (HBV). This study sought to identify predictors of HBV vaccine acceptance and compliance in a cohort of current drug users in Houston, Texas. Perceived severity of HBV, perceived risk of HBV, perceived peer support of HBV vaccine, and perceived benefits of HBV vaccine were also examined assess their relationship to HBV compliance. ^ Methods. A randomized intervention study was conducted in a cohort of current drug users in Houston, Texas. Participants were recruited by community outreach workers from two urban neighborhoods in Houston known for high drug use. Participants were randomized to a standard vaccine schedule group or an accelerated vaccine schedule group. Participants were also randomized to either a standard behavioral intervention group or an enhanced behavioral intervention group designed to increase HBV vaccine acceptance and compliance. Baseline visits included an interview for demographic factors, drug and sexual behaviors, and HBV beliefs; and participants received the first dose of the HBV vaccine and one of the behavioral interventions. ^ Results. Of 1,643 screening participants, 77% accepted the HBV vaccine. Participants ages ≥50 were twice as likely to accept the vaccine. African Americans and less frequent drug users were also significantly more likely to accept the vaccine. Of the 1,259 participants who enrolled in the study, 75% were compliant to the HBV vaccine. Predictors of compliance were found to be race, housing status, and alcohol use. Speedball users were found to be 74% less likely to be compliant the HBV vaccine. None of the behavioral constructs assessed were found to significantly predict HBV compliance. However, additional analyses found that there were significant changes in mean scores of the behavioral concepts when measured at six month follow-up. ^ Conclusion. Results from this study indicate that when offered a free vaccine in the drug user community, a large percentage will be compliant to the vaccine series. The behavioral cognitions commonly used in HBV compliance research need to be extended to accurately fit this cohort. Also, vaccine intervention focus needs to be on reaching the homeless segment of the drug users and the speedball users. ^

Charity care and community benefits by hospital type in Texas

Hospital care is the largest component of the health care sector. This industry is made up of for profit hospital (FPH) organizations, not for profit (NFP) hospitals, and government (GOV) run hospital facilities. Objectives of this analysis were: (a) to conduct a literature review on NFP hospital legislation at the state level in Texas and at the federal level in the broader U.S.; and (b) to describe the types of charity care and community benefits currently being provided: by NFP hospitals compared to FPH hospitals and GOV hospitals; by hospitals geographic proximity to the Texas-Mexico border; and by hospital community type (rural, suburban, and urban); and (c) propose specific policy changes that may be needed to improve the current Texas State statute. Methods. In describing the historical and current policy context of NFP hospital legislation in the United States, federal legislation was reviewed from 1913 to the present and Texas State legislation was reviewed from 1980 to the present. In describing the provision of charity care, data from the 2008 Annual Cooperative Hospital Survey were examined by hospital organizational type, size, proximity to the border, and community type using linear regression and chi-squared tests to assess differences in charity care and community benefits. Results. The data included 123 NFP hospitals, 114 GOV hospitals, and 123 FPH. Results. Small sized (p<0.001) and medium sized (p<0.001) NFP hospitals provide a greater percent of total charity care when compared to FPH hospitals and to both GOV and FPH hospitals respectively; however, no significant difference in total charity care was found among large sized NFP hospitals when compared to FPH hospitals alone (p=.345) and both GOV and FPH facilities (p=.214). The amount of charity care provided was not found to be different based on proximity to the border or community type. Community benefit planning and budgeting was found to be similar regardless of community type and proximity to the border. Conclusion. No differences in charity care in Texas were found for large sized NFP hospitals compared to FPH and GOV hospitals. Contrary to widely held beliefs, this study did not find the border region to provide a greater amount of charity care or bad debt. Charity care also did not vary by community type. These findings underscore the need for continued collection of transparent data from all hospitals in order to provide policy makers and consumers with information on utilization trends to ensure benefits are being provided to the community. Policy changes or revoking tax-benefits may occur as charity care utilization declines with the implementation of health reform in the next few years.^

Os efeitos fiscais e previdenciários da sentença trabalhista

Pretende-se com o presente trabalho de pesquisa abordar, do ponto de vista teórico, as especificidades da execução ex officio das contribuições sociais no âmbito trabalhista. A problemática gira em torno da natureza jurídica da contribuição social e do procedimento sui generis de execução na justiça do trabalho. A natureza tributária impõe uma série de implicações que devem ser enfrentadas pelo operador do direito, principalmente no que pertine as normas aplicáveis na constituição e exigência do crédito tributário. O objeto do trabalho consistirá na análise do procedimento de execução que deve ser adotado, visando o respeito dos demais institutos vinculados à execução tributária, inclusive, a prescrição e a decadência. Serão identificadas as peculiaridades desta competência concorrente, incluída a questão da possibilidade de utilização de períodos cujo vínculo tenha sido reconhecido por sentença trabalhista, para fins de obtenção de benefícios previdenciários.

Climate Change Policy & the Natural Gas Transmission Sector

Various emission reduction strategies are proposed to manage climate change in the U.S. This applied capstone evaluates the most likely policy options considering impacts and benefits to the natural gas transmission sector (NGT). It examines a case-study including a comparison of policy options to recommend the most beneficial program to the NGT sector. Two conclusions of major importance are: a federally preempted cap-and-trade program would be the most cost-effective for the NGT sector and the NGT sector should not be the point of regulation of any climate policy. Recommendations, strategies, and costs for implementation of a compliance plan for a federally preempted cap-and-trade program were developed as a tool for NGT companies as part of this applied capstone project.

Efficient taxation of multi-national enterprises in the European Union. Bruges European Economic Policy (BEEP) Briefing 5/2003

Current arrangements for multi-national company taxation in EU are plagued by severe conceptual and administrative problems, leading to high compliance costs, considerable uncertainty and ample room for abuse. Integration is amplifying these difficulties. There are two possible approaches in designing an efficient trans-border corporate tax system for the European Union. The first is to consolidate the EU-wide operations of MNEs, using an agreed common base as the reference variable, and then to apportion this total tax base using some presumptive indicators of activity in each tax jurisdiction – hence, implicitly, of the likely benefits stemming from each location. The apportionment formula should respect requisites of neutrality between productive factors and forms of corporate financing. A radically different approach is also available that offers considerable advantages in terms of efficiency, simplicity and decentralisation, including full administrative autonomy of national tax authorities. It entails abandoning corporate income as the relevant tax base and taxing at a moderate rate some agreed measure of business activity such as company value added, sales or employment. These are the variables usually considered in formula apportionment, but they would apply directly without having first to go through the complications of EU-wide consolidation based on a common-base definition. Reference to a broad base, with no exemptions or deductions, would allow to set low statutory rates.

Conference on Tax Administration Research, January 1985.

Item 956

Federal tax policy : its effect on health care costs, coverage and the uninsured /

"October 1992."

Tax reform proposals. hearing before the Committee on Finance, United States Senate, Ninety-ninth Congress, first session, July 18, 1985.

Shipping list no.: 86-99-P.

Tax reform proposals. hearing before the Committee on Finance, United States Senate, Ninety-ninth Congress, first session, July 19, 1985.

Shipping list number: 86-81-P.

Tax reform proposals. hearing before the Committee on Finance, United States Senate, Ninety-ninth Congress, first session, July 24, 1985.

Shipping list number: 86-109-P.