Tax Policy and Economic Development in Maine: A Survey of the Issue

The purpose of this report is to provide a foundation for discussion and debate of tax policy options generally and, in particular, those relating to economic development in Maine. The purpose of this report is to provide a foundation for discussion and debate of tax policy options generally and, in particular, those relating to economic development in Maine

Cooperation on Competition: The Multistate Tax Commission and State Corporate Tax Uniformity

This report explores how interstate uniformity of state corporate income taxes has varied over time, the role played by the MTC, and how likely it is that uniformity will be achieved. FRC Report 11

Perceptual adaptation by normally hearing listeners to a simulated "hole" in hearing

Simulations of cochlear implants have demonstrated that the deleterious effects of a frequency misalignment between analysis bands and characteristic frequencies at basally shifted simulated electrode locations are significantly reduced with training. However, a distortion of frequency-to-place mapping may also arise due to a region of dysfunctional neurons that creates a "hole" in the tonotopic representation. This study simulated a 10 mm hole in the mid-frequency region. Noise-band processors were created with six output bands (three apical and three basal to the hole). The spectral information that would have been represented in the hole was either dropped or reassigned to bands on either side. Such reassignment preserves information but warps the place code, which may in itself impair performance. Normally hearing subjects received three hours of training in two reassignment conditions. Speech recognition improved considerably with training. Scores were much lower in a baseline (untrained) condition where information from the hole region was dropped. A second group of subjects trained in this dropped condition did show some improvement; however, scores after training were significantly lower than in the reassignment conditions. These results are consistent with the view that speech processors should present the most informative frequency range irrespective of frequency misalignment. 0 2006 Acoustical Society of America

Income Tax Evasion

Jamaica\u27s 1986 personal income tax reform moved the nation well along toward tax simplification, a more uniform and fair treatment of taxpayers, removal of disincentives to in­creased work effort and to work effort allocation across sectors and a more level playing field for investment. The major elements of the reform are a flat rate income tax, a higher income exemption level, and the elimination of all tax credits and most nontaxable perquisites. While the impact of the reform on revenues and on the burden of various types of taxpayers has been carefully analyzed, much less has been done in terms of studying the impact on those who do not pay -- ­those who evade the income tax by either under­reporting or not filing. This paper presents estimates of the amount, structure and deter­minants of evasion by Jamaica\u27s hard-to-tax sec­tor, the self-employed. It should be emphasized at the outset that Jamaica\u27s problems with income tax evasion are not solved by the flat tax. While the new system lessens the rewards for evasion and through simplification makes compliance and monitoring easier, it will not automatically draw the self­-employed into the tax net. Why would a person who is successful at evading tax at a 57 1/2 percent marginal rate voluntarily come forward to pay because the rate has been dropped to 33 1/3 per­cent? The structural reform must be accompanied by a vigorous program of administrative im­provements. This is all the more reason to conduct a careful analysis of the amount and structure of income tax evasion. How much additional tax revenue could be captured in an effective pro­gram of enforcement, and what income groups, occupations, etc., should be targeted for increased coverage, examination and audit? The next section of this chapter summarizes the results of analyses of the national income accounts and the taxpaying characteristics of a random sample of six professional occupations. Both approaches are meant to infer the total amount of self-employed income tax evasion. The methodology used in drawing and analyzing a much larger and more representative sample of self-employed individuals is discussed in the fol­lowing section. Then we turn in the next three sections to the heart of this work: an analysis of filing rates and of the characteristics of self-­employed filers, an analysis of the revenue loss that results from those who do not file, and an analysis of audit/examination reports to estimate and explain the degree of underreporting by self­-employed filers. The final section of the paper is concerned with how tax policy and tax administration might be altered to draw the self­-employed into the tax net

Tax Structure and Tax Compliance

A model of individual tax compliance behavior, including evasion and avoidance, is developed and estimated. The model recognizes the importance of marginal income tax rates, payroll tax contributions and benefits, and the probability of detection and the penalty on unpaid taxes. Share equations for avoidance, evasion and reported income are estimated using individual-level data. The estimation results indicate that the tax base rises with higher benefits for payroll tax contributions and falls with higher marginal tax rates; the base also falls with more severe penalties and more certain detection of evasion as individuals substitute towards avoidance income

Admissibility of Non-U.S. Electronic Evidence

After two long years collecting hundreds of gigabytes of e-mail, data base reports, and social media posts from countries in Europe, Asia, and South America, such as France, South Korea, Argentina, Canada, Australia, and El Salvador, the day of trial has arrived. The trial team has obtained the data at great cost, in dollars as well as person-hours, but is finally ready for trial. First-chair counsel, second-chair counsel, and four paralegals file into the courtroom, not with bankers boxes full of documents as in earlier times, but with laptops, tablet computers, and a data projector. Following opening statements, the first witness takes the stand. After a few questions about the existence of e-mails written by executives of the defendant multinational corporation, a paralegal moves to the projector, as she rehearsed many times, to flip on the switch that will project the e-mails for the jury. She hears, “Objection!” followed immediately by, “Sustained.” Counsel asks for a sidebar. Instead, the judge asks the court officer to take the jury out. She then notes that these e-mails, the production of which she had ruled upon previously, were created outside the U.S. Who will testify to their authenticity? What was the chain of custody—were they altered in some fashion in the office or between the client’s servers and counsel’s laptop? How, exactly, do the e-mails fit into an exception to the hearsay rule? Business records? What is the “business” of this foreign facility that requires the use of e-mail on a regular basis? Counsel asks for a continuance to respond to those questions. “Denied!” the judge says

An Evaluation of the Structure of the Jamaican Individual Income Tax

The individual income tax is one of Jamaica\u27s most productive sources of government revenue, and certainly its most visible. Before reform, both the structure and the administration of the tax were badly flawed. As a result, the tax produced less revenue than it might have, was unfair in its distribution of tax burdens, and created severe disincentives for private sector economic growth. The material presented in the chapter provided the background data on which the 1986 reform was built

Audit Selection and Income Tax Underreporting in the Tax Compliance Game

This paper uses a game-theoretic model of the tax compliance game to estimate a model of audit selection and income tax underreporting in Jamaica. The empirical analysis make use of audited tax returns for individual taxpayers, and a random sample of tax returns for the population from which the audited returns are selected. The estimation results strongly indicate a nonrandom audit strategy, and thus provide support for the game-theoretic approach. The results also indicate that the probability of underreporting and the level of underreporting are positively related to the marginal tax rate and to income, and negatively related to marginal payroll tax benefits; in general, the underreporting elasticities are small

A Program for Reform

The Government undertook a far-reaching revision of the individual income tax in January 1986. The purpose here is to present the analysis that led to the reform, to review and evaluate selected elements of the reform, and to report the results of the first year\u27s experience with the new system. This chapter closes with an agenda of unfinished business, i.e., a statement of what is yet to be done to complete the structural reform of the individual income tax