Earlier this week on iShade’s BulletIN–the news section of our accounting community site–I spotlighted the fantastic Ernst & Young report titled “Long-Run Macroeconomic Impact of Increasing Tax Rates on High-Income Taxpayers in 2013.” Regardless of your political beliefs on tax increases, I think you’ll find this a fascinating read. I did, devouring it slowly in the basement a couple of evenings ago. Shockingly, the kids wanted no part of reading it or hearing any findings of the report.
The results of this study indicate long-run economic repercussions should the top two ordinary tax rates and investment tax rates rise as planned in 2013. Quoting the E&Y report: “this policy path can be expected to reduce long-run output, investment and net worth.” Note the word “reduce” in that sentence. This isn’t simply an overt opinion piece from E&Y intellectuals; there’s raw data to back this up. Of course, you can choose not to believe it.
Spout these data lines from the report around your company or public accounting firm if you want to spark some discussion on the matter:
*Changes would translate into a decline in GDP of $200 billion (yes, billion)
*Employment would fall by roughly 710,000 jobs or 0.5% (yes, unemployment would rise)
The rest of this year is going to sizzle with these tax issues, the election and everything related. Stay tuned to iShade’s BulletIN — THE accounting news source…keep it open on your computer every day. http://www.ishade.com/bulletin.php
Well, my friends, 2012 is certainly off to a roaring start with M&A activity in the public accounting profession. Check out “Firm News” on iShade’s BulletIn section for a host of announcements that have sprouted in the first ten days of this new year.
Joe Tarasco, Owner of Accountants Advisory Group, stated the following in Q4 of last year:
Mergers will continue with all size firms at a furious pace perhaps doubling the number that took place in 2011. The inability to attract and retain talent at smaller firms will make succession planning and growth initiatives almost impossible to implement and thus forcing them to combine with bigger firms.
Thus far, it’s hard to argue with Joe’s prediction. Come December, do you think he’ll be correct in his prognostication? My money’s on Joe.
For another prediction, I think the other Big Four firms will follow suit on Ernst & Young’s move yesterday. As announced on iShade’s BulletIn right when the news came out, E&Y will reimburse U.S. lesbian, gay, bisexual and transgender employees for the additional federal and state taxes they pay on same-sex domestic partners’ medical benefits. How can Deloitte, KPMG and PwC not make the same move? Kudos to E&Y.