Global Consultant Outlines Trends Shaping Sustainable Business in 2019

Sunil “Sunny” Misser, CEO of global consulting firm AccountAbility, recently joined Nareit for a video interview to discuss the trends that will shape the landscape of sustainable business in 2019.

Misser highlighted collaboration on climate action as one of the key trends to watch. “Industries are going to have multiple types of collaborative linkages and they’re going to see a big spurt toward climate action,” he said.

Other trends Misser noted include:

from News https://www.reit.com/news/videos/global-consultant-outlines-trends-shaping-sustainable-business-2019

Can the UK parliamentary system reform again like 1832?

Over the long course of history since 410AD, Britain has had a Parliament for a the country nearly the entire time. Groups advised the early English Kings and Norman despotism is more of a blip than the story itself. Certainly since 1215 and Magna Carta some of the people have had influence on the rulers. Indeed, since the 1640's and the last English Civil war, Parliament has been the main vehicle for political activism. Yet one of the biggest challenges to its supremacy was during the period when Britain globally was dominant. During the early 1800's real desire for reform of the 'rotten boroughs' and even the House of Lords took hold. But it did not take hold in Parliament, the pressing for change came from the Public. Both Whigs and Tories were either lukewarm or malevolent (such as passing the corn laws to protect further the landed aristocracy who made up the members of Parliament disproportionally at this time). But pressure from the people, from the workers and owners of our 'dark, satanic mills' in Leeds and Manchester grew to the point of rebellion. At this point, Parliament moved. The great reform act was passed and although in many ways only a partial fix, it changed the Country to be a more representative democracy. Opinion polls mattered, Political parties had to canvass for wider support. Over time further acts refined the work for Wales, Scotland and Ireland and the work towards Universal Suffrage was completed in the early 20th century. Across the rest of Europe, despotism ruled more tightly, leading to bloody revolutions in 1848 in order to achieve the progress won a generation earlier in England and here without bloodshed. I have long thought now of this comparison with the current Brexit mess in which we find ourselves. The political will of the people in the UK has been lukewarm to the EU. Too many of our ancestors have died fighting to free the markets of Europe from despots for the collective of the British people to think that growing a new one is the best idea ever. Of course, if you are Belgian, it is amazing that you can now vote yourself a seat in world affairs! Different histories, different perspectives. But our political class has long been in thrall, led by the miserable science of economics and the failure of socialism after the war to think the only way for the UK was to prostrate itself before the EEC, thence EU. Once in the game, the elites benefitted, enjoying tax free status and as the Kinnock family discovered, great wealth from 'EU' service. As the tension grew Blair made his fatal error as regards immigration and eventually the damn broke. Cameron hoped to repeat his victory over Scottish Independence with referendum device, but failure there has led to a domestic political crisis on a scale with the 18030's. The referendum genie is also a representative of a big change in society. With the advent of advanced technology, social media and such like, people are both more informed and more engaged. Many challenges such as climate change are global, economic challenges are global and politicians have less ability to control events. Moreover, expenses scandals and successive elections with professional politicians have revealed the venality of the political class. Again today it is parliament which is conservative. There is not talk of reforming the frankly ridiculous (by 21st century standards)House of Lords. The EU must not be left. Even the boundaries for elections are entrenched by political machinations, long overdue changes for representation. And the crowning glory, the Referendum on Brexit must be ignored or rejected. In 1832, eventually a way was found through the mess without civil war or bloodshed. Parliament moved decisively to vote for a change not in the interests of many members, but in the interests of the Country. it did not even require the election of extremists to achieve, the body politic adjusted to the pressure of the populace. Perhaps if May's deal had passed the same would have happened again, but for now I struggle to see the ability of Parliament to come to its senses and listen to its populace. This is about more than Brexit too, it is about high taxes and centralised control, an uncaring state handing out benefits or not...a diminution of local government and of course a government voting for wars few wanted and waves of immigration without consultation. Farage has few answers to these questions, but he poses the questions correctly which is why he looks again like he will win the EU elections if they happen. Where though are Labour and the Tories in even trying to grapple with these topics, they are lost in identity politics and the low politics of political rivalry. What do our readers make of this, how will this Gordian knot be untied?

from Capitalists@Work http://www.cityunslicker.co.uk/2019/04/can-uk-parliamentary-system-reform.html

Braemar Hotels CEO Says Luxury Sector Buyers are Impacting Pricing

Richard Stockton, president and CEO of Braemar Hotels & Resorts (NYSE: BHR), discussed developments in the luxury hotel segment during the latest edition of the Nareit REIT Report podcast.

from News https://www.reit.com/news/podcasts/braemar-hotels-ceo-says-luxury-sector-buyers-are-impacting-pricing

Personal Property Tax Compliance: Eight Frequently Missed Issues that Can Lead to Overpayments

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Understanding and adhering to the multitude of personal property tax compliance obligations throughout the thousands of jurisdictions that assess personal property taxes can be administratively burdensome. A company’s personal property tax liabilities can be impacted if a company is not equipped to navigate the differing rules and opportunities in the jurisdictions in which its personal property is located. The following summarizes the most often overlooked items that result in overpayments of personal property taxes by any organization.
 

		Classification of Property Double taxation of real and personal property can occur if a company incorrectly reports real estate as personal property. By understanding what qualifies as real estate in a jurisdiction and ensuring that real estate assets are not reported on a personal property tax return, taxpayers can avoid overpaying taxes on the same asset. Real estate tax and personal property tax administrators often work in separate divisions that do not share information, making it harder to spot errors. The cost of assets, especially specialized assets, may be included in both building cost and business personal property cost. Taxpayers may unknowingly be paying tax twice on the same asset.
		Proper Asset Useful Lives Reporting personal property assets to a jurisdiction begins with applying the original acquisition year and acquisition cost to the correct jurisdiction’s depreciation table. Unlike federal depreciation tables, each local jurisdiction can have its own schedule that can change from year to year. Applying assets to an incorrect depreciation table can result in overpayment of personal property tax. A single county can also have multiple tables that segregate classes of assets. Understanding an asset’s use, physical life, and embedded components and then applying that information to the most accurate jurisdictional tables can translate to property tax savings.
		Situs of Property The “lien date” is an annual date for determining the taxability of personal property in a jurisdiction. The most common annual lien date is January 1. Property is reportable by the owner of the property to the jurisdiction where the property is located on the lien date. Oftentimes, taxpayers mistakenly report property that is not located in the jurisdiction or report to an incorrect jurisdiction. Fixed asset listings do not necessarily provide the detail needed to understand the accurate situs, or legal location, of a property. Inquiries should be made to determine whether capitalized assets were delivered to the location as of the lien date and the physical location of bulk capitalized assets designated to a regional or central location.
		Reporting of “Ghost” Assets “Ghost” assets are capitalized fixed assets that no longer physically exist, but have not been removed from the fixed asset ledger. Typically, ghost assets have been fully depreciated for GAAP and tax purposes, and, therefore, may not be removed from the fixed asset ledger in a timely manner. Since the fixed asset ledger is the audit trail for personal property reporting purposes, nonexistent or ghost assets often are reported and taxed. A disposal policy or methodology should be instituted to avoid property tax overpayment.
		Inventory A number of states tax inventory as part of tangible property tax. Among the inventory taxing states, reporting standards vary, including types of inventory and values reported, periods of reporting used, and available exemptions for inventory turnover. Understanding the most advantageous filing methodologies can result in significant savings.
		Execution of Filing Requirements Personal property tax laws can be unique to each jurisdiction. Understanding and complying with the requirements is essential to avoid overpayments, penalties, and interest. Items that are often overlooked include applicable deadlines and understanding whether the deadline is a received by or postmark date; reporting on the correct form; return signing and notarization; inclusion of all required attachments; jurisdiction mailing address; and additional requirements for exemptions and abatements.
		Capitalized versus Expensed New tangible property regulations have prompted changes in capitalization thresholds. Generally, all assessable property located in a jurisdiction as of the lien date is reportable, regardless of whether it was expensed or capitalized. Taxpayers often rely on the fixed asset register for reportable assets and may miss assets that were expensed. Certain jurisdictions also tax supplies, which taxpayers frequently overlook. Under audit, taxpayers can incur penalties and interest related to the omitted property.
		Exemptions and Abatements Personal property tax exemptions and abatements reduce or subsidize the tax on personal property. The availability and requirements vary by jurisdiction. For example, some states exempt entire classes of property such as intangibles, inventory, and software.Other states offer exemptions for pollution control equipment or Freeport inventory. Abatements may be available for capital investments for a length of time or pursuant to alternative agreements that reduce taxes, such as PILOTs (payment in lieu of taxes). Securing the exemption or abatement often requires adherence to a one-time process or may include an annual compliance component. Failing to comply with requirements may trigger a loss of the reduction or a claw-back that may incur a penalty.

Any business that owns property has a property tax obligation. Failure to understand property tax laws could result in overpayment of personal property tax, and failure to comply with property tax laws could result in seizure of property and/or penalties. Business owners should be aware of their property tax obligations, and they should consider a strategic approach to minimize the tax burden.
 
Read Top 10 Property Tax Myths to learn more ways you may be missing an opportunity to reduce your property tax liability.
 
LEARN MORE ABOUT BDO'S PROPERTY TAX SERVICES ►
 

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CONTACT:

Dorothy Radicevich
National Property Tax Leader

from BDO USA Tax Publications Feed https://www.bdo.com/insights/tax/state-and-local-tax/personal-property-tax-compliance-eight-frequently

Q1 2019 Updates For Economic Nexus Thresholds On Remote Sellers For Sales And Use Taxes

Summary

Virginia recently adopted economic nexus thresholds for sales and use tax collection purposes, while North Dakota and Washington amended their existing rules.  Virginia adopted South Dakota’s thresholds of $100,000 or 200 transactions, which were the subject of the U.S. Supreme Court’s Wayfair decision.  North Dakota and Washington amended their statutes to remove the 200-separate-transactions test.  Other states simply codified their existing regulations or administrative guidance.
 
Visit BDO’s Wayfair resource center for an analysis on the Wayfair decision, along with a detailed state-by-state analysis on each state’s economic nexus threshold.
 
Also read BDO’s article on other major jurisdictions that recently adopted economic nexus provisions on remote sellers, including California, New York, Texas, and Washington D.C.
 

Details

Virginia

On March 26, 2019, Virginia enacted H.B. 1722.  Effective July 1, 2019, the new law requires remote sellers to register and collect sales tax if they exceed Virginia’s economic thresholds.  It amends the definition of a “dealer,” under Code of Virginia Section 58.1-612(C).  Beginning on July 1, 2019, a remote seller will be required to register and collect sales tax if it meets either of the following two tests:

• If the seller receives more than $100,000 in gross revenue from retail sales in Virginia in the previous or current calendar year.
• If the seller engages in 200 or more separate retail sales transactions in Virginia in the previous or current calendar year. 

Unlike other states, Virginia included an aggregation method in calculating whether the remote seller exceeds the threshold.  In determining the amount of gross receipts or the total number of retail sales transactions, the sales made by all “commonly controlled persons” must be aggregated.  Code of Virginia Section 58.1-612(D) defines a “commonly controlled person” as any person that is a member of the same controlled group of corporations, as defined under IRC Section 1563(a).  This is a major difference from other states.
 
The law also established the same economic nexus thresholds for “marketplace facilitators” and “marketplace sellers.”  Under the new law, a marketplace facilitator is the dealer that is required to collect the sales tax, while marketplace sellers are relieved of collection duties.  However, the marketplace facilitator may obtain a waiver from the Virginia Department of Taxation by showing that all of its marketplace sellers are properly registered and collecting sales and use taxes.  If the marketplace facilitator obtains a waiver, then it will be relieved from collecting sales tax on behalf of its marketplace sellers.
 
North Dakota – 200 Separate Transaction Test Eliminated

On March 6, 2019, North Dakota enacted S.B. 2191, effective for tax years beginning after December 31, 2018.  The bill amends N.D. Cent. Code Section 57-39.2-02.2 by removing the test of whether a seller sold tangible personal property (TPP) in more than 200 separate transactions.  The only test that remains is whether the seller’s gross sales from the sale of TPP and other taxable items delivered into North Dakota exceed $100,000 in the previous calendar year, or the current calendar year.
 
The $100,000-only threshold under S.B. 2191 is effective beginning January 1, 2019.  Consequently, if a remote seller exceeded the 200-separate-transactions test under the previous law, which was effective from October 1, 2018, through December 31, 2018, then it would still have established economic nexus for that period.
 
Washington – 200 Separate Transaction Test Eliminated

Similarly, on March 14, 2019, Washington enacted S.B. 5581.  The bill became effective the same day.  Like North Dakota, Washington’s bill eliminated the 200-transactions test from its economic nexus provisions.  Effective March 14, 2019, through December 31, 2019, a “remote seller” is relieved of its collection responsibilities if the obligation arose solely from exceeding the 200-transactions test.  Effective January 1, 2020, the only bright-line economic nexus test that remains when calculating “substantial nexus” for “sellers” is whether the business has more than $100,000 of cumulative gross receipts in Washington.
 
Also, like North Dakota, if a remote seller exceeded the 200-transactions test under the previous law, which was effective from October 1, 2018, through March 14, 2019, then that remote seller may still have established economic nexus for that period.
 
Apart from amending its “substantial nexus” thresholds, the bill also did the following:

• Eliminated click-through nexus. 
• Beginning on July 1, 2019, the bill also eliminates the notice and reporting requirements that were created under the 2017 marketplace fairness laws. 
• The definition of “seller” was amended to include “marketplace facilitators” and “marketplace sellers.” 
• When calculating whether a marketplace facilitator meets the $100,000 gross receipts threshold, the marketplace facilitator must include its own receipts, as well as gross receipts from all marketplace sellers through the marketplace facilitator’s marketplace.
• Beginning on October 1, 2018, marketplace facilitators must collect and remit sales tax if they exceed the economic nexus thresholds, regardless of whether the marketplace seller also has a collection responsibility.  And, beginning January 1, 2020, the collection obligations of marketplace facilitators also applies to other taxes and fees imposed on a retail sale made or facilitated by the marketplace facilitator.
• Finally, beginning on January 1, 2020, the bill also amended the economic nexus threshold for the B&O tax by lowering it from $267,000 to match that of sales tax at $100,000 gross receipts.  The bill also eliminated the property and payroll factors for purposes of B&O tax apportionment. 

Other States’ Legislative Updates Related to Economic Nexus for Remote Sellers

• Nebraska – On March 21, 2019, Nebraska enacted Legislative Bill 284, which codified its economic nexus thresholds for remote sellers of $100,000 or 200 separate transactions.  Nebraska’s registration and collection responsibilities are effective April 1, 2019.
• North Carolina – On March 20, 2019, North Carolina enacted S.B. No. 56, which codified its remote seller thresholds of $100,000 or 200 transactions, as established in Directive No. SD-18-6.
• Kansas – On March 25, 2019, Governor Kelly vetoed S.B. 22, which would have adopted economic nexus thresholds for remote sellers, among other things.
• Rhode Island – On March 29, 2019, Rhode Island enacted S.B. 251 Sub A, which updated its economic nexus laws to include “marketplace facilitators,” with thresholds of $100,000 or 200 separate transactions.  It also eliminates the option of remote sellers to comply with notice and reporting requirements, in lieu of sales tax collection. 

 

BDO INSIGHTS

• The thresholds discussed in this article only apply to remote sellers that do not have physical presence in that state.  If the seller had physical presence in a state before exceeding that state’s economic nexus rule, the seller may still have nexus for sales tax purposes.  In that scenario, the seller should perform an exposure analysis and consider mitigation strategies, such as voluntary disclosure agreements or amnesty programs.
• In states like North Dakota and Washington that eliminated their 200-transactions test in 2019, be aware that for previous periods, a remote seller may have met the states’ economic nexus thresholds by exceeding 200 transactions.  The previous law that has now been amended is still effective and applicable to those prior periods.  And, establishing nexus in 2018 could potentially create a trailing nexus issue for a remote seller in 2019, even if that seller does not otherwise meet the $100,000 threshold.
• Various other states have proposed legislation to adopt (e.g., Idaho), codify administrative guidance, or modify, economic nexus thresholds for remote sellers.  For example, Oklahoma introduced a bill that would increase its threshold from $10,000 to $100,000, while Georgia introduced a bill that would lower its threshold from $250,000 to $100,000.  There has also been a trend by state legislatures to introduce bills related to marketplace facilitators.  Stayed turned for future BDO alerts.

LEARN MORE ABOUT BDO'S STATE & LOCAL TAX SERVICES ►
 

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CONTACT:
 

Atlantic:		Central:
Angela Acosta Tax Managing Director		Eric Fader Tax Managing Director
Jeff Saltzberg Tax Managing Director		Mike Feiszli Tax Managing Director
Southeast:		Southwest:
Tony Manners Tax Managing Director		Tom Smith Tax Partner
Katherine Gauntt Tax Senior Manager		Greg Rosser Tax Managing Director
Northeast:		West:
James Bowden Tax Managing Director		Ken Choi Tax Senior Partner
		Steve Oldroyd Tax Managing Director

from BDO USA Tax Publications Feed https://www.bdo.com/insights/tax/state-and-local-tax/q1-2019-updates-for-economic-nexus-thresholds-on-r

Positive benefits of EU Referendum felt by all already by all UK residents

Let's compare and contrast some statistics that Remain fans will not want published too much, for fear they give succour to the Leave cause.




Firstly, here is Reuters news today:




Total earnings, including bonuses, rose by an annual 3.5 percent in the three months to February, the Office for National Statistics said, matching the median forecast in a Reuters poll of economists.


That was the joint highest rate since mid-2008 although in February alone the pace of wage growth slowed.

Britain’s labour market has defied the approach of Brexit, helping households whose spending drives the economy.   
 
The ONS said employment grew by 179,000 in the three months to February, in line with the Reuters poll forecast.


“The jobs market remains robust, with the number of people in work continuing to grow,” ONS statistician Matt Hughes said. “The increase over the past year is all coming from full-timers, both employees and the self-employed.”


The pace of wage rises remains slower than the 4 percent increases seen before the financial crisis.




Of course they have a nice 'Despite Brexit' line in here as always!




But more interesting is they only explain half the conundrum of rising wages. Here the author wants the readers to believe the simple causation between new job creation and rising wages. However, we know this cannot be the whole story as Britain has been a jobs miracle for over 7 years, with huge growth un employment but a very patchy record on wage growth. Indeed, it has been poor, with wages only now rising above the Financial Crisis period.




So what else might be a driver to be pushing up wages? Perhaps as well as demand issue there is a supply issue, what is happening to the supply of Labour?


Below are the recent ONS migration statistics:








And what a surprise we see! there is a big drop since the referendum in EU people coming to the EU looking for work and although and increase in Non-EU, there is not enough to offset this. Furthermore of the EU citizens coming to look for work the real drop is in Eastern Europeans coming to the UK, in fact on balance they are leaving the UK, even as overall migration remains at all time highs.


What this shows us is that the Referendum has already put people off coming to the UK (thanksto all media for calling Leavers 'Racist' for 2 and a bit years, it seems to have worked!). This in turn has reduced the supply of Labour looking for work, which when allied to a continuing increase in jobs available has led to the Holy Grail - Lower long-unemployment, Lower youth unemployment, record tax revenues and decent wage increases. No wonder the overall economy is looking pretty healthy, despite Brexit!

from Capitalists@Work http://www.cityunslicker.co.uk/2019/04/positive-benefits-of-eu-referendum-felt.html

Diversity Makes Groups Perform Better, University of Michigan Professor Says

Scott Page, professor of complex systems at the University of Michigan, participated in a video interview at Nareit’s REITwise: 2019 Law, Accounting & Finance Conference in San Antonio.

Page, a noted author on the topic of diversity, discussed how it drives performance.

“When you think about things like solving problems, finding creative solutions to problems, [and] making accurate forecasts, diversity actually creates a bonus—it makes groups better at what they do,” he said.

from News https://www.reit.com/news/videos/diversity-makes-groups-perform-better-university-michigan-professor-says