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TAX POLICY BLOG: FOR SPINACH IN PRINCIPLE, AGAINST IN PRACTICE

January 17, 2006

The Tax Policy Blog has a good post up discussing the dynamics of targeted tax incentives, better known as corporate welfare:

"The best tax policy that states can promote would not include these targeted tax policies for specific industries or companies, but rather a policy that taxes all industries equally and with a low rate; thereby promoting investment across the board and not distorting investment decisions."

Oddly, the Tax Foundation, which hosts the Tax Policy Blog, is strongly against the Cuno decision, which strikes down Ohio's tax incentive scheme. They've even filed a brief with the Supreme Court defending the right of states to enact corporate welfare tax incentives.

I'm sure the Tax Foundation has good lawyers with all sorts of good legal reasons why states should be free to engage in trade wars with other states through corporate welfare. I'm not a lawyer, I say it's all spinach, and I say the hell with it.

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