Tax Reform: When? August may be too soon. Gary Cohn, National Economic Council Director, told Bloomberg that while taxes are a priority, “Getting it done well and getting it done right is more important than getting it done soon. We are committed to getting it done this calendar year.” Last month, Treasury Secretary Steven Mnuchin predicted a bill would pass Congress by August.
And with whom, and how? Senate Majority Leader Mitch McConnell doesn’t think he can work with Democrats on tax reform. He says Democrats want to use the tax code for income redistribution while Republicans see it as a tool for job creation. While McConnell wants to work with Democrats on some legislation, he says he’ll still use budget reconciliation to pass a tax bill with 50 votes, a strategy that effectively cuts out Democrats.
Will Orrin Hatch retire? The 83-year-old chairman of the Senate Finance Committee is up for reelection in 2018. He insists he’s running but told reporters Friday that he might step aside if Mitt Romney runs.
West Virginia is not quite closer to a budget deal. Democratic Governor Jim Justice thought he reached a deal with state Senate Republicans to limit spending cuts, raise the state’s gasoline tax, and levy a surtax on its wealthiest residents. The chamber voted instead to close a budget deficit with deeper spending cuts, a broader and higher-rate sales tax, and an income tax cut. Justice may call the legislature back for a special session to reach a new agreement.
Alaska’s House majority has a revamped oil tax bill. House Democrats couldn’t advance an income tax plan, so they unveiled a modified oil tax proposal. It would nix cash subsidies for North Slope companies and bar firms from using most tax credits to bring their rates below a minimum floor. They’d also eliminate a per-barrel of oil production credit, while lowering the base tax rate. Governor Bill Walker’s office estimates the legislation would add $130 million to the state's bottom line in 2019, rising to $325 million by 2023—assuming oil price forecasts are accurate.
Have you filed your 2013 tax return? The IRS issued a reminder to those who have not. They have until April 18 to file 2013 tax returns and claim any refund. The IRS holds $1 billion in unclaimed refunds for about 1 million people. So much money left on the table, so little time left to get it.
Indian police arrest suspected IRS scam call center kingpin. Sagar Thakkar, a 24-year-old working out of a Mumbai suburb, may be the criminal responsible for scamming thousands of Americans out of $300 million. Call center workers would lie to Americans about tax debts and threaten arrest or deportation unless they paid up immediately. Thakkar left India in October after police detained more than 700 call center workers and indicted over 60 people, including Thakkar. Indian police caught him at the Mumbai airport over the weekend. The US is seeking his extradition.
Congress is in recess. The Daily Deduction will post again on Monday, April 17, and will resume its regular schedule when Congress returns.
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