Next week on the Hill — A Senate vote on highway funding. Senate Majority Leader Mitch McConnell plans to hold a procedural vote on Tuesday on a six-year funding plan for the Highway Trust Fund. Senators James Inhofe and Barbara Boxer of the Environment and Public Works Committee are working out the final language. Inhofe is optimistic: “I anticipate that we will have actually passed in the next few days ... a long-term, maybe a six-year highway reauthorization bill.”
Optimism, meet reality? Will the Senate really be able to fund infrastructure for six years? Transportation advocates hope so: They aren’t thrilled with the House’s short-term patch. A long-term funding plan would likely rely on some changes to international tax rules. Both parties are on board with taxing—at a rate lower than 35 percent—$2 trillion in offshore profits held by US corporations. But will businesses go for it? Lowering the rate for corporations does little to help small business that file taxes on individual returns. Then, there’s the controversy over other pay-fors, such as rumored cuts to federal employee retirement benefits.
Meanwhile, Candidate Clinton has a tax credit carrot for profit-sharing companies. Democratic presidential contender Hillary Clinton would give companies 15 cents for every dollar of profits shared with their employees. Her two-year plan would cost $10 billion to $20 billion over ten years. She’d pay for it by closing the ever-popular unspecified tax loopholes. Bloomberg explains that the credits are a way for Democrats to push spending programs that could otherwise never make it through a GOP-controlled Congress—especially the current one.
Can the IRS become a consumer-friendly agency in an online world? Taxpayer Advocate Nina Olson wants the IRS to transform itself into an agency that primarily serves people who want to pay their taxes on time and correctly. In her vision, as TPC’s Howard Gleckman explains, each taxpayer requesting assistance would be assigned a single IRS staffer to help see their issue to its resolution. It’s a laudable goal, but 95 percent of tax returns were filed online this season. Gleckman concludes, “The days when most taxpayers have direct person-to-person contact with IRS employees for routine, non-confrontational issues, are long over.”
Interested in subscribing to the Daily Deduction, the Urban-Brookings Tax Policy Center summary of the day’s tax news? Sign-up here to get the Daily Deduction delivered to your inbox every morning. If you’d like to tell us about a new research paper or have any comments about our feature, write us at firstname.lastname@example.org.
Posts and comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.
- © Urban Institute, Brookings Institution, and individual authors, 2022.