Build Back Better back-burnered? The Washington Post reviews the state of play, such as it is, on the president’s spending package and Sen. Joe Manchin’s $1.8 trillion counteroffer. “Senior Democrats say they do not believe Manchin would support his [own] offer even if the White House tried adopting it in full — at least not at the moment.” Still, House Speaker Nancy Pelosi says, “there’s an agreement to be reached.” She did not say when.
President Biden’s 2023 budget likely released in March. The statutory deadline for the president’s budget is the first Monday in February, but congressional staff expect to see his fiscal plan budget after Biden’s State of the Union address on March 1. Lawmakers now hope to reach a deal on BBB and the fiscal 2022 appropriations (for the year that began last December) by early February. If they can’t, the 2023 budget could be further delayed.
In California: Lawmakers propose universal healthcare funded with new taxes. Democratic lawmakers unveiled the plan that would require a constitutional amendment to impose a new gross receipts tax and a payroll tax hike on businesses. It also would increase personal income taxes on salaries above $149,509 a year and add a 2.5 percent surcharge taxable income exceeding $2.5 million. These personal income tax increases could rise with inflation in future years. The new taxes would require a supermajority vote in the legislature.
Tune in tomorrow at 12:30: Taxing Business Income. More than half of non-corporate business income in the National Income and Product Accounts does not show up on tax returns. In an online event, TPC’s Bill Gale and the Brookings Institution’s John Sabelhaus will discuss their new research on income reported in the Survey of Consumer Finances but not reported for tax purposes, and how it affects income distribution and revenues. TPC’s Janet Holtzblatt and the Federal Reserve Board’s Alice Henriques Volz will discuss the findings. Learn more and register here.
In case you missed last week’s Prescription with David Wessel. You can watch the full conversation between the director of the Brookings Institution Hutchins Center on Fiscal and Monetary Policy and TPC’s Howard Gleckman on Opportunity Zones. How did they come to be included in the 2017 Tax Cuts and Jobs Act and what are the implications of that decision.
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