Congress is in recess. The Daily Deduction will publish Mondays until Congress returns in mid-September.
September could be a big month for candidate tax plans. GOP contender Donald Trump plans to release his comprehensive plan in September. He vows to raise taxes on hedge fund managers but provide tax relief to the middle class. Meanwhile, Jeb Bush says he’ll release his plan on September 9. Worth remembering: Tax cuts still do not pay for themselves.
CBO projections tell a rich story. TPC’s Howard Gleckman explains that CBO’s projected rise in individual income taxes is largely due to a phenomenon known as real bracket creep. CBO expects incomes to rise faster than inflation in coming years, pushing incomes into higher tax brackets. High-income households will enjoy much of that income growth.
Arizona’s Medicaid expansion is not a tax, says Maricopa County Superior Court. Former Governor Jan Brewer expanded Medicaid in 2013, funded with a hospital assessment. But 36 GOP lawmakers who voted against the plan went to court, calling it a tax increase that required a two-thirds majority in the state’s legislature. Judge Douglas Gerlach disagreed. An attorney for the lawmakers promises to appeal the decision.
Should college endowments be tax free? TPC’s Howard Gleckman wonders: "Why not just make the endowments taxable and use some of the huge revenue windfall to boost tuition assistance and other supports for those students who really need it?"
Brazil President Dilma Rousseff drops her plan to revive a financial transactions tax. Her plan to reintroduce a 0.38 percent levy would have raised an estimated $19 billion annually that she promised to use to reduce the nation’s huge budget deficit. But her own ruling coalition did not support the levy.
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