When it comes to tax plans, Trump is from Mars, Clinton is from Venus. TPC’s Howard Gleckman takes a look at the differences showcased in Monday’s debate. “Trump’s tax cuts would increase incentives to save, work and invest—and add trillions of dollars to the budget deficit, which would drive up interest rates and very likely wipe out most or all of the benefits of his tax cuts. By contrast, Clinton’s plan would provide some new tax subsidies for middle-income households with specific financial challenges… But these subsidies wouldn’t do very much to boost the economy, at least in the short run. And her tax increases on businesses and high-income households would likely reduce their incentives to save and invest.”
On the Hill, still: The spending bill. Senate Democrats blocked the spending bill that would keep the government funded through December 9. The bill had not included funding for the water crisis in Flint, Michigan. Democrats say the bill should such funding if the bill includes money for Louisiana flood relief. Senate Majority Leader Mitch McConnell said dropping the flood money is “certainly an option.” Without a bill by October 1, the government will shut down.
Years after the recession, many states are still rebuilding their budget reserves. The Pew Charitable Trusts reports that in fiscal year 2015, only 19 states had rebuilt their rainy day funds to levels they had before the economic downturn that began in 2007. Only 15 states expected to end fiscal 2016 with a larger financial cushion than before the recession.
Wyoming lawmakers reject a boost in the wind energy tax. An interim joint revenue committee proposed a hike to the nation’s only wind energy production tax from $1 per megawatt hour to $3. The new revenue would have helped pay for school construction projects, and might have totaled $40 million annually. Conservative lawmakers killed the bill, saying the tax increase would have discouraged wind energy production in the state.
Australia is missing out on $763 million in annual tax revenue from food sales to China. Chinese purchasing agents buy items like baby formula, general produce, and health products in Australia and ship them to China. Chinese consumers buy the items from the agents, but the agents haven’t been declaring their profits in Australia. The transactions take place through off-shore accounts—accounts the Australian Tax Authority can’t track.
Meanwhile, backpackers in Australia can rest a little easier. The Australian government took heed of the farming and tourism industries complaints and ditched a plan to level a 32.5 percent tax on every dollar earned by visiting workers. Instead, backpackers will pay 19 cents on every dollar they earn.
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- © Urban Institute, Brookings Institution, and individual authors, 2016.