Senate Democrats take the first step toward budget reconciliation. By a party-line 50-49 vote, the Senate voted to consider the resolution that likely will be the vehicle for passing a new round of pandemic relief. Senators voted shortly after President Biden urged Majority Leader Chuck Schumer to “act boldly and quickly” on a relief measure. The House is likely to take a similar step tomorrow.
There’s another way to target pandemic relief payments. TPC’s Jim Nunns explains how Congress could target aid to those whose incomes fell between 2019 and 2020. The IRS could make these payments relatively quickly and easily by taking advantage of the tax return filing calendar. The payment amount would be a percentage of the reduction in the taxpayer’s income from 2019 to 2020, up to a capped amount.
And a way to better target the Child Tax Credit. TPC’s Howard Gleckman suggests lowering the phase-out thresholds for President Biden’s proposed credit expansion to $75,000 for single parents and $150,000 for couples. The current CTC doesn’t start to phase out until $400,000 for couples.
Should unemployment benefits be tax-exempt? Sen. Dick Durbin and Rep. Cindy Axne have introduced a bill to waive federal income taxes on the first $10,200 of unemployment benefits received in 2020. The measure would apply to workers who received benefits either through federal pandemic-related unemployment programs and/or traditional state-based unemployment benefits.
Warren Joins the Finance Committee. Sen. Elizabeth Warren is the panel’s newest member. Can a debate over the wealth tax be far behind?
Pennsylvania Governor Wolf wants to raise income taxes to boost public school funding. The Democratic governor released details of his budget plan for the fiscal year beginning July 1. He’d increase the state’s flat personal income tax rate from 3.07 percent to 4.49 percent, with a higher exemption for the lowest earners. The rate hike could generate up to $2 billion.
New York State’s local governments saw a 10 percent decline in sales tax revenue in 2020. State Comptroller Tom DiNapoli reports that sales tax revenues across the state were $1.8 billion lower than in 2019. In New York City, revenues fell 35 percent in the first quarter, while revenues elsewhere in the state fell 19 percent during the same time period.
US keeps tariffs on United Arab Emirates aluminum. Just before leaving office, former President Trump moved to lift a 10 percent tariff on the UAE-based aluminum due to the “important security relationship” between the two countries. But Biden reversed that plan, saying “imports from the UAE may still displace domestic production, and thereby threaten to impair our national security.”
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