The White House IDs its top Build Back Better priorities. While talks among Democrats may, or may not, be ongoing, congressional leaders have been awaiting signals from President Biden about which elements of the stalled BBB bill are his top priorities. Yesterday press secretary Jen Psaki named four: “Universal pre-K, efforts to cut the cost of child care, elder care, and make sure that we're investing in addressing the climate crisis.”
Tax relief in New York State? Gov. Kathy Hochul proposed $2.3 billion in tax relief aimed at boosting the state’s economic recovery. In her State of the State address she proposed tax cuts and rebates for middle-class New Yorkers and small businesses. They include a $1 billion tax rebate for to 2 million property owners. Middle- and low-income households would receive the biggest benefits.
Huge December tax collections in Massachusetts. The Bay State collected $4.24 billion, which beat estimates by 40 percent. The Department of Revenue attributed much of the increase to a new law that allows pass-through businesses to avoid the federal cap on state and local tax deductions. Even after the state refunds many of those payments to the business owners, fiscal 2022 year-to-date collections still will be $2.67 billion higher than in the same period last year and 10 percent over budget.
Tax the (very newly) rich… Two lucky people won the $632 million Powerball jackpot. Each prize is worth an annuitized $316.3 million or $225.1 million in cash. That lump sum would be subject to 24 percent federal income tax withholding. In Wisconsin, one winner also faces 7.65 percent withholding worth $17.2 million. The second winner lives in California that does not tax lottery winnings.
The US trade deficit grew. The deficit climbed to a record $80.2 billion in November, after falling a bit in October. Services exports rose but goods exports fell. At the same time, there was a big increase in goods imports as US consumers continue to buy and supply chain bottlenecks eased. The trade deficit still is significantly affected by the pandemic.
For the latest tax news, subscribe to the Tax Policy Center’s Daily Deduction. Sign up here to have it delivered to your inbox weekdays at 8:00 am (Mondays only when Congress is in recess). We welcome tips on new research or other news. Email Renu Zaretsky at firstname.lastname@example.org.
Posts and comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.
- © Urban Institute, Brookings Institution, and individual authors, 2021.