TPC estimates the revenue and distributional effects of Tax Cuts 2.0. TPC’s latest analysis finds that making the Tax Cuts and Jobs Act’s individual and estate tax cuts permanent would reduce federal revenues by $3.8 trillion between 2026 (when the TCJA’s individual tax cuts are scheduled to expire) and 2038. On average, households would get a tax cut of about $1,600 but the benefits would be skewed to the highest income 20 percent of taxpayers. Two-thirds of households would get a tax cut, but about 9 percent would pay more, and about one-quarter would pay roughly what they would under current law. TPC modeled only the “Protecting Family and Small Business Tax Cuts Act of 2018.” It has not yet estimated the effects of two much smaller companion bills.
There could be at least four House GOP “no” votes on Tax Cut 2.0. Reps. Dan Donovan and Peter King of New York and Frank LoBiondo and Chris Smith of New Jersey say they would reject extending tax cuts if the legislation also continues the TCJA’s $10,000 cap on state and local tax (SALT) deductions. The House Ways & Means Committee considers the legislation today. So far, it would extend the SALT deduction cap.
Senate confirms Rettig, SFC considers a Treasury nominee. After clearing a series of procedural votes and despite objections from some Democrats, the Senate confirmed Charles Rettig as IRS commissioner yesterday by a vote of 64-33.The Senate Finance Committee will hold a hearing on the nomination of Michael Faulkender to be a Treasury assistant secretary for economic policy today at 2:00 pm.
Is a homeless tax on corporations in San Francisco worth it? According to the latest polling, 56 percent of city voters want to tax corporations to raise $300 million a year to house the homeless. But that tax, Proposition C on the city’s November ballot, would house about 4,000 people over five years, costing $500,000 per newly housed person. When voters in the poll saw that math, support for Proposition C fell to 47 percent.
How might Georgia fare after Wayfair? A new brief from Georgia State University’s Fiscal Research Center looks at Georgia’s online retail sales tax law in the wake of the Supreme Court’s Wayfair decision that allows states to require online sellers to collect sales tax. Georgia’s requirement goes into effect in January and the study predicts the state could collect between $168 million and $285 million in new sales tax revenue in the first fiscal year. Local governments could collect between $132 million to $225 million.
Ghana’s government hires a consulting firm to help with tax collections. Ghana’s treasury missed its revenue target for the fiscal year ending August 31 by $367 million, largely because of less-than-expected customs collections. The government has hired McKinsey & Co. to help build a revenue collections system that Ghana needs to meet its budget target. Ghana is in its final year of a $1 billion International Monetary Fund bailout.
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