v Reactive State Economic Woes How Should Societies React How many states are moving toward taxing voluntary transactions Are taxing professional services inevitable how do we react during this transition ID: 373306
Download Presentation The PPT/PDF document "Proactive" is the property of its rightful owner. Permission is granted to download and print the materials on this web site for personal, non-commercial use only, and to display it on your personal computer provided you do not modify the materials and that you retain all copyright notices contained in the materials. By downloading content from our website, you accept the terms of this agreement.
Slide1
Proactive v. Reactive
State Economic Woes:
How Should Societies React?Slide2
How many states are moving toward taxing “voluntary transactions
”?
Are taxing professional services inevitable?how do we react during this transition?
?Slide3
How to Position CPA Societies? We walk a fine line. Are we
Trusted advisors to policy makers
(demonstrating independence and objectivity)OR
Advocates for our members?
(demonstrating political strength and uniformity of mission)Slide4
DO WE JUST SAY “NO!”
Exercise political muscle
Activate grassroots networksDemonstrate that we are indeed member advocates?
?Slide5
Or…Should we recommend changes to tax and social policies to meet the state’s needs?Are we good citizens or good advocates?
?Slide6
Trusted Advisor OptionsSeek CPA appointments to any tax study group, blue ribbon commission, tax code or revenue commission, etc.
Low risk for politicians to establish
Studies turn into legislationDemonstrates respect for the profession
Opens opportunities to affect future legislative policies
Members expect us to be in the loopSlide7
Trusted Advisor OptionsRisk to being part of the study groupsTacit endorsement of any bonehead ideas they propose
Controversial report or legislation can anger members
Finding committed CPAs that will actually attend the meetingsSlide8
Trusted Advisor OptionsEstablish CPAs as experts in state policy
Great example is
Ohio’s Report to the Legislature (by the Society)
South Carolina’s Commission
on Tax Reform (3 CPAs on the Commission)
CPA State Budget Analysis (CAFR) Task Force
Kentucky’s “trusted advisor” approach:
Tax Policies that Make Sense
Booklet
Pros and Cons of Tax Policy Proposals
BookletSlide9
Trusted Advisor OptionsLOOKING FOR EFFICIENCIES AND COST-CUTTING IN GOVERNMENT
Our members have expertise in systems analysis, pension funding, economic development, business plans, government auditing, etc…
State policies often waste time, energy, resources and put tax dollars at risk. [Kentucky State Auditor}Kentucky Airport, League of Cities, etc.
Kentucky School renovation policies
Kentucky’s 120 county governments!Slide10
But CAN WE TRUST OUR MEMBERS TO DELIVER? WILL CPAs REALLY INVEST THE TIME AND RESOURCES TO DO THE ANALYSIS?
?Slide11
Trusted Advisor OptionsLOW HANGING FRUIT: Offer Other Tax Ideas
Variety of Tax Options to Replace Service Tax
Property Tax IncreaseRestructure Individual Income Tax and/or Business Tax
Sales Tax Increase
Removal of Business to Business Exemptions (taxing business inputs)
Excise Taxes
Business Development Incentives, etc.
Specialized Taxes (Gas Tax, Telecommunications, etc.)Slide12
Does anyone have a bill?who will be the losers?Who will we Tick-off And Do we care?
Will our MEMBERS’ clients and companies care?
?Slide13
Need for ResearchTAX INCENTIVES How do States know if they really work?
Who is doing a cost-benefit analysis?
NCSL Meeting Report: CEOs can’t tell you what incentives they received,
or what they saved the company, or if they were even part of their decision process
What they can tell you is what it cost them in
personal
income taxSlide14
Need for ResearchPosition Papers make great points, but
economic proof
is needede.g., When companies move across state lines, we not only loose the service tax, we loose revenue from:
Occupational taxes
Sales taxes
Business taxes
Property taxes (as families move)
Intangible property taxes
Excise (e.g. communication taxes)
Insurance taxes
Restaurant and retail business, etc…
Slide15
Is anyone working with a consultant on economic analysis?Is this something the AICPA can help with?
?Slide16
Need for ResearchIf we step forward with a plan, no matter how rational, will…
Our members blame us for supporting a tax on their services?
Will legislators purposefully misinterpret our intensions to pass only the portions they like?
(The chairman of A&R stood up on the Kentucky House Floor and announced KyCPA was in favor of his entire “
tax modernization
” plan)Slide17
“Sometimes being nice only causesconfusion”John Cooper, Lobbyist
!Slide18
Need for ResearchIf we propose trade-offs or big-picture solutions to the financial crisis, what should they be?
How do we know our proposals will work to improve economic development?
Who will be the losers in the new tax structure?
Are we willing to take the hit from those who get hurt?Slide19
Will our members will willing to give clients bad news?How do we protect our member CPAs from angry clients or employers?
?Slide20
Helpful AmmoAICPA Talking Points & White Paper
COST White Paper (Council on State Taxation)
Minnesota Talking Points (website paper)Position on elimination of business and manufacturing exemptions / taxing business inputs
Connecticut Position Papers
Tax Foundation Background Paper 2011