A lower tax on repatriated earnings could boost the US dollar. Some analysts say it might, according to The Wall Street Journal (paywall). President-elect Donald Trump would tax more than $2 trillion in corporate earnings held overseas at a maximum of 10 percent instead of 35 percent. Some say the influx of exchanged foreign currency could strengthen the already rallying dollar, though the effects would likely be modest.
Who would be hit by Trump’s proposed cap on individual deductions? While Trump’s overall tax plan is highly regressive, his $100,000 limit on itemized deductions ($200,000 for couples) would mostly hit high-income households, according to new TPC projections. TPC’s Howard Gleckman notes that the vast majority of taxpayers do not even itemize and thus would be exempt from Trump’s cap.
Retailers remind House Republicans that some corporate tax changes would hit consumers. The House Republican “Better Way” tax plan would raise taxes on imports, says the Walmart-Target set, and they are already lobbying in response. Higher taxes on imports would translate to higher prices for consumers. Members of the National Retail Federation say an import tax could be as much as five times their profits.
The AICPA weighs in on tax priorities. With tax changes likely in 2017, the American Institute of CPAs shared its legislative priorities that partially mirror the “Better Way tax plan.” The accountants back lower tax rates for businesses, simplified education-related and retirement-savings tax provisions, repeal of the alternative minimum tax, and improved IRS service to taxpayers and tax preparers.
Some fiscal policy opportunities for President Trump. TPC’s Gene Steuerle identifies six possible reform opportunities for the incoming president, including taxes, Social Security, health care, and worker assistance. But, Gene suggests, Trump would have to carefully frame these changes to win bipartisan support.
IRS phone call scams are down, but not gone. A spokesperson for the Treasury Inspector General for Tax Administration said that since the indictment of dozens involved in Indian call center scams, “reports of these fraudulent calls have dropped significantly, from a high of over 38,000 new reports a week to just over 2,000 reports of fraudulent calls to TIGTA last week." Tax Analysts reports (paywall) that it is unclear that the indictment alone contributed to the drop.
In Australia, a new “backpacker tax” stalls in the Senate. Late last week the nation’s Senate said no to a House-approved 19.5 percent income tax on those working under holiday visas. The latest version would reduce the government’s proposed 32.5 percent tax, which failed in September after widespread opposition. The new tax would apply to working visitors under age 31 with passports from 19 eligible countries. Previously, they paid no tax on earnings up to AU$18,200 (or $13,900), which is what most earn during their stay. A new Senate counter-proposal suggests a 10.5 percent tax.
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