Random Primordial Magnetic Fields and the Gas Content of Dark Matter Halos

We recently predicted the existence of random primordial magnetic fields (RPMF) in the form of randomly oriented cells with dipole-like structure with a cell size $L_0$ and an average magnetic field $B_0$. Here we investigate models for primordial magnetic field with a similar web-like structure, and other geometries, differing perhaps in $L_0$ and $B_0$. The effect of RPMF on the formation of the first galaxies is investigated. The filtering mass, $M_F$, is the halo mass below which baryon accretion is severely depressed. We show that these RPMF could influence the formation of galaxies by altering the filtering mass and the baryon gas fraction of a halo, $f_g$. The effect is particularly strong in small galaxies. We find, for example, for a comoving B_0=0.1\muG, and a reionization epoch that starts at $z_s=11$ and ends at $z_e=8$, for $L_0=100\,\text{pc}$ at $z=12$, the $f_g$ becomes severely depressed for M<10^7\msun, whereas for $B_0=0$ the $f_g$ becomes severely depressed only for much smaller masses, M<10^5\msun. We suggest that the observation of $M_F$ and $f_g$ at high redshifts can give information on the intensity and structure of primordial magnetic fields.Comment: 7 pages, 10 figures, accepted for publication in MNRAS (several improvements after suggestions of the referee

President Obama's International Tax Proposals Could Go Further

The author argues that the Obama Administration's 2011 international tax proposals represent a very cautious first step toward making US multinationals pay their fair share of the tax burden and that coordination with our FDI partners would allow the Administration to go even further

International Tax as International Law

The purpose of this article is to introduce to the international lawyer the somewhat different set of categories (e.g., residence and source rather than nationality and territoriality) employed by international tax lawyers, and explain the reasons for some of the differences. At the same time, it attempts to persuade practicing international tax lawyers and international tax academics that their field is indeed part of international law, and that it would help them to think of it this way. For example, knowledge of the Vienna Convention on the Law of Treaties would help international tax lawyers in interpreting tax treaties, and avoid some common mistakes

Commentary (Response to article by H. David Rosenbloom)

David Rosenbloom has delivered an important lecture on an important topic:\u27 whether exploiting differences between the tax system of two different jurisdictions to minimize the taxes paid to either or both ( international tax arbitrage ) is a problem, and if so, whether anything can be done about it in a world without a world tax organization. As Rosenbloom states, international tax arbitrage is the planning focus of the future, 2 and recently has been the focus of considerable discussion and debate (for example, upon the promulgation and subsequent withdrawal under fire of Notice 98-11).3 Rosenbloom\u27s lecture is one of the first attempts to address the underlying questions in a systematic manner, and thus represents a major contribution to what will no doubt be a fascinating and important debate.

For Haven\u27s Sake: Reflections on Inversion Transactions

This article discusses “inversion” transactions, in which a publicly traded U.S. corporation becomes a subsidiary of a newly established tax haven parent corporation. In the last three years, an increasing number of these transactions have been taking place, undeterred by the shareholderlevel tax imposed by the IRS on them in 1994. The article first discusses the reasons for the increasing popularity of the transactions and the tax goals they aim at achieving (primarily avoiding subpart F and U.S. earnings stripping). The article then discusses the tax policy implications of these transactions. In the short run, the article suggests that the proper response is a redefinition of the concept of corporate residency. The article criticizes the shareholder-based redefinitions embodied in some current anti-inversion proposals, and suggests instead adoption of a modified “managed and controlled” test for all corporations. In the longer run, inversions may lead to abandonment of residence based corporate taxation in favor of source-based taxation. If that is the case, it is imperative to preserve the corporate tax base by developing better methods of determining the source of income (for example, formulary apportionment), and by putting some limits on tax competition

Beat It: Tax Reform and Tax Treaties

The Tax Cuts and Jobs Act (TCJA) includes several provisions that may be viewed as potential violations of US tax treaties. However, most of those potential violations, such as new IRC section 951A and to a large extent new IRC section 59A, are covered by the Savings Clause (US model article 1(4)). The only remaining question is whether IRC section 59A (the “Base Erosion Anti-Abuse Tax”, or BEAT) violates the non-discrimination provision (article 24), which is exempted from the Savings Clause. The answer is no, because foreign related parties are not comparable to US related parties receiving interest or royalties

Overcoming Political Polarization: Federal Funding of Education Is the Key

The best way of overcoming political polarization in the US (the last two elections were both decided by fewer than 100,000 votes in WI, MI, PA (2016) and WI, AZ, GA (2020)) is to reduce disparities in education. But how can we do that? The basic problem arises from the US system of funding K-12 education from property taxes. While the picture above refers to college education, it is K-12 education that determines both college admissions and college readiness. Thus, the only viable solution is a federal solution. As President Nixon proposed in 1972, the United States should adopt an “Education Value Added Tax” (E- VAT) and use the revenues to equalize per student school funding across the country, as well as funding universal free public pre-K programs (such as the ones instituted by Mayor DeBlasio in NYC) and universal free public colleges for in-state residents (as used to be the case in California)

Obama\u27s International Tax Plan: A Major Step Forward

President Barack Obama last week personally introduced a set of proposals to reform U.S. international taxation that are the most significant advance toward preserving the income tax on cross-border transactions since the enactment of the subpart F rules by the Kennedy administration in 1962. (For prior coverage, see Doc 2009-10047 or 2009 TNT 84-1.) In essence, the Obama proposals introduce a 21stcentury version of the vision begun by Thomas Adams in 1918 and continued by Stanley Surrey in 1961: a world in which source and residence taxation are coordinated so as to achieve the underlying goals of the international tax regime. As I have explained at length elsewhere, those goals are known as the single tax principle (all income from cross-border transactions should be subject to tax once, not more and not less) and the benefits principle (active income should be taxed primarily at source, and passive income primarily at residence)

Enforcing Dividend Withholding on Derivatives

The United States imposes a 30 percent withholding tax on dividends paid to nonresident aliens. However, this tax is rarely paid by portfolio investors because they can swap into U.S. securities, receiving payments to match both capital gain and dividends. Treasury has ruled that swap payments have an origin in the taxpayer’s residence so there is no withholding obligation on payments that match dividends. The proposal would impose withholding tax on dividend equivalents on the ground that there is no policy justification for a distinction between dividends, substitute dividends under securities lending transaction (which are treated as dividends and are subject to withholding), and dividend equivalents paid under swaps. The proposal is made as a part of the Shelf Project, a collaboration of tax professionals to develop and perfect proposals to strengthen the tax base. Shelf Project proposals are intended to raise revenue without raising rates — the best systems have the lowest feasible tax rates because the taxes are unavoidable. Shelf projects defend the tax base and improve the rationality and efficiency of the tax system. Given the current calls for tax stimulus, some shelf projects may stay on the shelf for awhile. A longer description of the Shelf Project can be found at ‘‘The Shelf Project: Revenue-Raising Projects That Defend the Tax Base,’’ Tax Notes, Dec. 10, 2007, p. 1077, Doc 2007-22632, 2007 TNT 238-37. Shelf Project proposals follow the format of a congressional tax committee report in explaining current law, what is wrong with it, and how to fix it