Breaking up and starting over? The White House and Senate Democrats want to revive talks on President Biden’s Build Back Better (BBB) agenda for climate and social spending. In a press conference last week, Biden acknowledged that the massive bill would likely need to be broken up. West Virginia Sen. Manchin wants a “clean sheet of paper,” telling reporters that “we’ll be starting from scratch.”
Families are feeling the effects of expanded CTC expiration. NPR reports on families struggling to make ends meet as they struggle with the continuing pandemic and inflation. Census data show that one in four parents have used the expanded monthly Child Tax Credit to pay for child care. Without a CTC payment this month, the poverty rate among children could increase from 12.1 percent to 17.1 percent, the highest rate since December 2020.
ISO: 200 new IRS lawyers to crack down on abusive shelters. The agency is looking for experienced lawyers to help go after “syndicated conservation easements, abusive micro-captive insurance arrangements and other tax schemes.”
Michigan Gov. Gretchen Whitmer: Repeal the ‘state income tax’ on pensions. The Democratic governor’s State of the State address on Wednesday will call for repealing the tax on pensions. It would save 500,000 Michigan seniors an average of about $1,000 a year. Over 3 years, she’d fully exempt income from public pensions and partially exempt income from private pensions. Republican lawmakers are likely to support the effort.
Virginia Gov. Youngkin wants big tax cuts. The newly elected Republican governor’s legislative priorities include doubling of the state’s standard deduction to $9,000 for single filers and $18,000 for married couples filing jointly. He’d also distribute a one-time tax refund of between $300 and $600, tax cuts for veterans, and require voter approval of local property tax increases.
Arizona’s marijuana tax is bringing in better than expected revenues. The state levies a transaction privilege tax and a 16 percent excise tax on marijuana sales. In the first year since the state legalized recreational marijuana, the revenue department collected close to $200 million in taxes on weed, about $65 million more than expected.
In case you missed these on TaxVox… TPC’s Richard Auxier details why Florida Republican Gov. Ron DeSantis’ plan to use American Rescue Plan funds to suspend that state’s gasoline tax for five months is doubly wrong. TPC’s Aravind Boddupalli and Livia Mucciolo share results of their research on how much states and localities collect from fines, fees, and forfeitures and how they use those revenues—specifically speeding tickets.
Join Doug Elmendorf on this week’s episode of The Prescription. On Thursday at Noon, the dean and professor of public policy at Harvard’s Kennedy School and former CBO director will talk with TPC’s Howard Gleckman. They’ll discuss inflation, fiscal policy, and how policy could improve the nation’s long-term outlook. To watch, register here.
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