Corporate tax cuts: The messaging battle continues. The House Ways & Means Committee reviewed Treasury regulations that implement the Tax Cuts and Jobs Act’s business provisions. Committee Democrats argued that the rules are too favorable to business and were adopted in response to corporate lobbying. Republicans said stakeholder feedback is a normal part of the regulatory process and that the guidance does not give businesses the opportunity to avoid taxes they would otherwise owe.
Going after surprise billing though private equity. The Ways & Means Committee plans to mark-up a bipartisan bill today aimed at curbing medical practices owned by private equity firms from engaging in “surprise billing.” The controversial practice hits patients with unexpected medical charges that are not covered by insurance.
A tax policy cocktail sure to result in a hangover: The Education Freedom Scholarships and Opportunity Act. TPC’s Howard Gleckman argues that the new tax initiative in President Trump’s budget is bad policy paired with horrific design, like “cheap red wine mixed with Dr. Pepper.” Under a similar bill proposed by Sen. Ted Cruz, the federal government could reimburse parents for the entire cost of their child’s private school K-12 education and provide 100 percent tax credits to individuals and businesses that contribute to state-created scholarship funds for other children in private schools. It offers generous subsidies to those who may not need it, funds state scholarship programs with no clear administrative structure, and attacks publicly funded schools. Cheers?
A big majority of New York State voters support a wealth tax. A survey conducted by Hart Research finds 92 percent of respondents support a 2 percent state tax on wealth exceeding $1 billion and raising the state income tax on income above $5 million a year. The same majority also supports a new tax on non-residence luxury homes or apartments that are worth more than $5 million.
Georgia’s income and sales tax collections are up. The governor’s office announced this week that state tax collections jumped by 4.5 percent in January (up 4.3 percent for individual income tax and 4.6 percent for sales tax). This follows revenue woes of 2019 that prompted Governor Brian Kemp to cut spending by $200 million in fiscal 2020 and $300 million in 2021.
But Minnesota’s individual income tax and corporate tax revenues were down last month. Revenue collections fell 9 percent, or $228 million, below expectations. But the commissioner of the Department of Minnesota Management and Budget (MMB) says not to worry. He thinks the drop was due to a timing issue: More taxpayers seem to be waiting until April 15 rather than paying at the end of the 2019 calendar year. In December, MMB estimated a $1.3 billion surplus for the year.
Municipal gas taxes in Illinois? A Democratic state senator, Bill Cunningham of Chicago, would give municipalities the power to levy a motor fuel tax. Right now, only cities in counties with a population exceeding 3 million people can do so. If his bill becomes law, municipalities would be able to tax gas sold within their community in one-cent increments up to 3 cents per gallon. The tax would not apply to aviation fuel.
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