Tomorrow on the Hill. The Senate Finance Committee holds a corporate integration hearing with TPC’s Steve Rosenthal among the witnesses. The panel will focus on whether to reform the corporate tax by allowing firms to deduct dividends—an idea backed by chairman Orrin Hatch. The House Ways & Means Health Subcommittee will hold a hearing on tax-related proposals to improve healthcare. The House Appropriations Committee will mark up a bill to maintain fiscal 2016 funding levels for the Joint Committee on Taxation and the Congressional Budget Office.
The House Judiciary Committee will be busy through June. The panel announced plans to consider impeaching IRS Commissioner John Koskinen, starting with a hearing on May 24. Tax Analysts reports (paywall) that Chairman Bob Goodlatte also is circulating a draft of his alternative to the Marketplace Fairness Act.
Can’t we all just share our tax information? At a Christian Science Monitor breakfast on Friday, Treasury Secretary Jack Lew reiterated his call for Congress to strengthen tax information sharing, reports (paywall) Tax Analysts. The Foreign Account Tax Compliance Act (FATCA) requires Congress to enact additional legislation to ensure reciprocal exchange of information but lawmakers have ignored the White House’s repeated requests to act.
On sharing his own tax information, Donald Trump says, “None of your business.” GOP presumptive presidential nominee Trump told Good Morning America that he does not believe the American people have a right to see his returns. No matter: Top Trump aide Paul Manafort said “middle America” doesn’t care about Trump’s tax returns, anyway.
As for Trump’s tax plan: Maybe he won’t change it after all. The New York Times reports Trump’s spokesperson Hope Hicks’ assertion that Trump is sticking with his plan, which would add nearly $10 trillion to the federal debt. “I’m a little bummed out if his spokeswoman says they’re not going to make any changes to the plan,” confessed Trump tax adviser Stephen Moore of the Heritage Foundation. Moore and economist Larry Kudlow have been saying they were revising the plan at Trump’s request.
In Mississippi: The biggest tax cut in state history. Governor Phil Bryant just signed a $415 million tax cut. Beginning in 2018, the state will begin to phase out its $260 million corporate franchise tax and reduce its income tax by $145 million. Starting next year, it will trim its self-employment tax by $10.2 million over three years.
And in California, Governor Jerry Brown notes the volatility of the income tax. He sent the state legislature a revised budget that forecasts a $1.9 billion decline in tax receipts. California could face a deficit of as much as a $4 billion by the summer of 2020. “Right now, the surging tide of revenue is beginning to turn,” Brown said. Tax revenue from high-income households is key to the state’s fiscal health, but their capital gains vary too widely for the state’s fiscal comfort.
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