In the State of the Union, President Obama suggested that the foreign earnings of U.S. corporations should be subject to a “minimum tax” to prevent corporations from shifting earnings to tax havens. The White House has promised to release the detailsabout the level and operation of such a minimum tax in the next few weeks.
Category Archives: Blog
Some Potential Changes to IRA Tax Rules
The total assets invested in Individual Retirement Accounts (IRAs) are growing larger. As of the end of the third quarter of 2011, IRAs (including Roth IRAs) held $4.6 trillion in assets—up from $2.6 trillion in 2000, according to the Investment Company Institute. Traditional IRAs represent almost 90% of this total. This growth in assets represents a big source of potential tax liability to many investors, and a source of potential tax revenue for the government.
The Good and the Bad of Private Equity
Mitt Romney’s candidacy has inspired a great deal of debate about the role of private equity in our economy. Romney’s opponents have openly questioned whether private equity serves a legitimate purpose in a capitalist system. Many claim that private equity merely facilitates a transfer of wealth from employees of a company to the private equity managers that take it over.
The NIH Needs a System to Evaluate NCATS, its New Center for Translational Research
Medical institutions have increasingly focused on translational research. The purpose of such research is to accelerate the application of basic scientific discoveries to practical therapies; in other words, to transport discoveries from the researcher’s bench to the patient’s bedside.
Obama Hints at Foreign Source Tax Reform
In last night’s State of the Union address, President Obama proposed a minimum tax for foreign profits of U.S. corporations:
First, if you’re a business that wants to outsource jobs, you shouldn’t get a tax deduction for doing it…. No American company should be able to avoid paying its fair share of taxes by moving jobs and profits overseas. From now on, every multinational company should have to pay a basic minimum tax.
Sadara Ventures: Developing the tech industry in Palestine
Last week, I visited Israel last week as part of a Harvard Business School trip on the subject of innovation. One of the groups we met was a new venture capital fund called Sadara Ventures (which is a name that connotes “pioneering” in Arabic). Sadara focuses on Palestinian investments—mainly in the city of Ramallah in the West Bank.
Challenges for private pension plans
2011 was a tough year for private defined benefit pension plans (DB plans). According to a report from Credit Suisse, the funding gap for the DB plans of S&P 500 companies rose from $250 billion at the end of 2010 to $450 billion at the end of 2011. Note that this is much higher than the shortfall during the peak of the financial crisis, which was estimated at $274 billion.
Rick Santorum, taxes, and the role of government
Now that Rick Santorum has emerged as the latest candidate to challenge Mitt Romney, we should take a closer look at what he believes about tax policy. To his credit, Santorum’s policy proposals are less radical than those of the previous anti-Romney’s—Perry, Cain, and Gingrich. For the most part, his plan resembles mainstream conservatism. But two policies suggest a role for the government that may prove unacceptably large to conservative voters.