Finance panel Democrats press Mnuchin on taxes. The Treasury Secretary met with members of the Senate Finance Committee yesterday, a rare session that included Democrats. It went about as expected, but not well. Ranking panel Democrat Ron Wyden told reporters after the session that the Ds insisted any tax cuts be skewed to middle-income households and that the Senate GOP leadership move a bill with a 60-vote majority and abandon budget reconciliation as a tool. Committee chair Orrin Hatch says he’d like a bill to be bipartisan but Majority Leader Mitch McConnell doesn’t think that’s realistic.
But President Trump’s tax ideas are very generous to about 400 people. The Center on Budget and Policy Priorities' new analysis shows that “The 400 highest-income taxpayers — whose incomes average more than $300 million a year — would get average tax cuts of at least $15 million a year each.”
Will advertising remain a deductible business expense? Companies currently can deduct advertising costs from their income and business groups want to keep it that way. But House Ways & Means Chairman Kevin Brady says there “may be a need” to consider revenue-raisers proposed in former Chairman Dave Camp’s 2014 tax plan—which would have allowed only a 50 percent deduction of advertising expenses. That could have raised $169 billion over ten years.
A stand-alone idea for tax reform: Immediate expensing. South Dakota Republican Sen. John Thune touts his tax plan on CNBC.com. His bill, the New Ventures and Economic Success Today (INVEST) Act, would allow all businesses to deduct half their investments in most property and equipment in the year they are purchased. Small and medium-sized businesses could immediately expense up to $2 million in new investments.
A new survey shows little interest in corporate tax cuts. It is a top priority for the Trump Administration and the House GOP leadership but not, apparently, for the public. A Politico Morning Consult poll finds that 59 percent of those surveyed think corporations pay too little tax already.
Trigger-happy… TPC’s Richard Auxier tells the tale of two tax triggers, one in Oklahoma and one in Washington, DC. Triggers, or fiscal-benchmark-driven tax cuts, can help states make budget-friendly tax reductions, but only if designed well. If not, they can make it “easy for lawmakers to pass large tax cuts that imperil future budgets.”
Just in time for summer: State gas tax increases. TaxNotes considers six states that have approved gas tax hikes this year in order to pay for infrastructure. They are California, Indiana, Montana, South Carolina, Tennessee, and Utah.
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