Miller & Chevalier’s 2010 tax policy forecast survey is out (TOH WebCPA), and it starts with this rather gloomy preface:
Although Congress and the Administration continue to focus their attention on health care reform and the continuing economic downturn, the business community can expect that there will be a significant focus on tax policy issues in 2010, including the potential for the consideration and enactment of proposals that increase the corporate tax burden.
According to survey respondents:
An increase in the U.S. taxation of international operations (74 percent), increased taxes on capital gains, dividends and interest (67 percent) and codification of the economic substance doctrine (61 percent) are named as the leading tax revenue sources to be tapped to fund Congressional initiatives in 2010.
We sure hope they’re wrong. As we’ve noted elsewhere, if the federal government makes a concerted effort to finance its spending from current and short term revenues, then economic outcomes are sure to disappoint. In the wake of a financial crisis, money is in relatively short supply (high demand), and the last thing the public sector should be doing is competing for savings.