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Life Insurance Abuses, Election Season Tax Cuts

Wyden expands an investigation of tax avoidance through private placement life insurance (PPLI). TaxNotes reports (paywall) that Senate Finance Committee Chair Ron Wyden is expanding an investigation into PPLI abuses. They were intended as tax-advantaged savings vehicles for middle-income households. But they are being used to invest millions of dollars in hedge funds and other vehicles, accumulating substantial income tax-free. The average amount invested in the separate accounts was $7.45 million and the largest held more than $73 million.

It’s official: Coloradans can pay their taxes with cryptocurrency. As promised by Gov. Jared Polis, residents can now pay Colorado’s individual income tax, business income tax, sales and use tax, withholding tax, severance tax, and excise fuel tax with Bitcoin and other cryptocurrencies. Will taxpayers bite? Bitcoin hit a three-year low over the weekend. 

You can tell it’s election season. Florida Governor Ron DeSantis, running for reelection and with an eye on the 2024 GOP presidential nomination, has proposed more than $1 billion in sales tax cuts. He’d permanently exempt cribs, strollers, clothing, baby wipes, diapers, medical equipment, and pet medicine from the state’s 6 percent sales tax. He’d suspend for a year the tax on pet food and household items that cost $25 or less, such as paper goods. Because Florida has no personal income tax, the sales tax is a major source of revenue.  

UK Prime Minister Truss: We have to look at our tax rates. An emergency government budget statement will be released Friday, and Prime Minister Liz Truss is laying the groundwork for tax cuts that benefit the United Kingdom’s wealthiest. She says she is ready to make “unpopular decisions” that include repealing an income tax increase that funds health care and scrapping a plan to raise corporate taxes.

UN Secretary General: “Polluters must pay” with a windfall tax. UN Secretary General Antonio Guterres told the General Assembly the largest energy companies made close to $100 billion in the first quarter of this year and urged “all governments to tax these excessive profits and use the funds to support the most vulnerable people through these difficult times.”

Meanwhile,  Russia may raise its tax on oil and gas exports. The Kremlin wants  to raise about $50 billion in new revenue next year. It would boost export duties on natural gas by up to 50 percent, increase taxes on oil exports by an as yet unspecified amount, and impose a new tax on liquified natural gas exports.  

 

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