The House takes its first step toward a budget bill to carry Biden relief plan. Last evening, the House passed a budget resolution for fiscal 2021. It is the House’s start towards passage of the budget reconciliation bill that would be the vehicle for the next pandemic relief measure. The Senate passed its version of the resolution earlier this week.
Brookings: Biden’s plan would return the economy to pre-pandemic levels, but the GOP plan would not. Brookings analyzed both the $618 billion GOP proposal and President Biden's $1.9 trillion plan. Researchers found the Republican plan would boost gross domestic product (GDP) by 1.6 percent in the last quarter of this year and 0.8 percent in the same period of 2022. Biden's proposal would boost fourth quarter GDP by 3.6 percent in 2021 and 2.1 percent next year.
Biden may revise relief payment thresholds. He told House Democrats that he’s sticking with $1,400 payments but would be willing to lower the income levels where the assistance phases out. He reportedly is considering a plan similar to one TPC analyzed last week. However, Senate Finance Committee Chair Ron Wyden opposes any effort to scale back the number of recipients.
Democrats urge repeal of CARES Act business tax break. The pandemic relief package enacted last spring allows companies to carry back for up to five years any net operating losses generated from 2018-2020. A group of 120 House and Senate Democrats want the next relief package to end that break and use resulting revenue to fund relief to families.
What do you — or all Americans — think about taxes? The Tax Hound, in an unscientific survey, asked her friends and family what they think about taxes and government spending. How do they feel about how much they pay, whether the federal government should cut spending or raise taxes (or both) in response to deficits, and whether the federal government should assist state and local governments? Their views track with national public opinion data, but tune in tomorrow at noon to learn from experts what Americans think about taxes
Biden names more top Treasury officials. The new administration is going to focus on taxation of multinational corporations. Itai Grinberg will serve as Deputy Assistant Secretary for Multilateral Tax Policy, Rebecca Kysar will serve as Counselor to the Assistant Secretary for Tax Policy, and Tom West will serve Deputy Assistant Secretary for Domestic Business Tax Policy. Grinberg and Kysar have been strong critics of tax avoidance by multinational corporations. West, when in private practice, advised clients on global tax planning and compliance.
Speaking of international taxation…. Tune in at Noon today for The Prescription. University of California, Berkeley’s Alan Auerbach will talk with TPC’s Howard Gleckman about the forthcoming book Taxing Profit in a Global Economy, which Auerbach coauthored with five internationally prominent economists and lawyers. They’ll discuss the flaws in the existing international taxation system and two models for radical reform. The conversation starts at noon, watch here.
How could the United States pay for reparations? TPC’s Janet Holtzblatt and Noah Zwiefel consider the question. According to Duke economist William Darity and his co-author Kirsten Mullen, it could cost as much as $10.7 trillion. The US could borrow the money, but taxpayers would ultimately bear the cost. Or it could raise taxes. Janet and Noah describe one way. “If a goal is to reduce the racial wealth gap, that could be achieved by transferring assets from the very rich to those who face significant barriers to accumulating wealth.” In other words: tax wealth.
Speaking of a wealth tax. In Washington State, lawmakers are considering introducing a wealth tax on some financial assets.. The proposal would be effective Jan. 1, 2022, and could generate $2.5 billion a year. Washington would become one of the first states in the nation to pass a measure of its kind.
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- © Urban Institute, Brookings Institution, and individual authors, 2020.