Ryan's latest tax reform. On a morning when the financial and economics world is focused on Brexit, House Speaker Paul Ryan timing wasn't the best, but he's going to roll out the House GOP's tax plan this morning. The plan, which leaves a lot of details to the imagination, would set three individual rates--33-25-12, cut the corporate rate to 20 percent, and set a top rate on investment income of 16.5 percent. Pass-through business would pay a 25 percent rate. Ryan says the plan would raise the same amount of money as the current tax code, after including macroeconomic effects and assuming a baseline where $400 billion in temporary tax cuts is made permanent.
Two years later, San Francisco will again try to pass a soda tax. In 2014, a soda tax was backed by nearly 55 percent of voters, but failed because the version required a two-thirds super-majority for passage. But backers redesigned the initiative so voters in November can approve the penny-per-ounce tax on sugary drinks with a simple majority. The big change: Instead of designating a specific use for the revenue, the upcoming measure would let an advisory panel suggest new programs to reduce the consumption of sugar-sweetened beverages in the city.
Kansas, Cont’d. With Governor Sam Brownback refusing to roll back his controversial tax cuts and the state legislature unwilling to approve ever-deeper spending cuts, the state is about to start the coming fiscal year with, shall we say, a cash flow problem. The AP reports the governor and legislative leaders have agreed to take out a $900 million short-term loan to pay the bills through June, 2017. The state is also considering dipping into the state’s transportation and corrections budgets, as well tapping $45 million in Medicaid dollars.
And in Portland, Oregon, a pot tax could help clean the air. The city council voted unanimously to impose a 3 percent tax on recreational marijuana but hasn’t yet decided how to spend the $3 million to $5 million in projected revenue. Clean air advocates would use pot-tax money to help curb exposure to diesel pollution.
Up I-5, a gun tax in Seattle: Legal, says state attorney general. The city’s $25 per gun and 2 or 5 cents per round of ammunition tax went into effect on January 1. Gun advocates claim the levy is a regulatory fee that runs afoul of a Washington State ban on city regulation of firearms. But state prosecutor Bob Ferguson says in a brief that the tax is truly a tax, since it’s designed to raise revenue rather than regulate guns.
On the Hill. The conservative Freedom Caucus urged the House to impeach IRS Commissioner John Koskinen. Meanwhile House Judiciary Committee Chairman Bob Goodlatte seems open to merely censuring the commissioner. The House Oversight and Government Reform Committee voted for censure last week. The House has adjourned until after July 4th, but the Senate will remain in session. The Finance Committee holds a hearing next week on the proposed Medicare Part B drug demonstration.
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