Waiting for CBO… Missouri GOP Senator Roy Blunt says the Senate will wait for a CBO score of the health care legislation before proceeding with a vote. He acknowledged that any Senate version will be very different than the House measure and the two will eventually have to be reconciled. Meanwhile, Speaker of the House Paul Ryan characterized his chamber’s vote on the un-scored American Health Care Act as a “rescue mission.”
Mission accomplished, but what’s next for tax reform? National Economic Council Director Gary Cohn says that unlike health care, the tax reform process will be inclusive; though his definition doesn’t appear to include Democrats. He said the administration plans to reach out to House Freedom Caucus and industry groups. The Freedom Caucus is already planning on writing its own version of a tax bill. TPC’s Howard Gleckman thinks tax reform just got harder, given the upcoming legislative and fiscal hurdles to passing health care legislation.
Speaking of harder, the border-adjustable tax isn’t winning many Senate friends. GOP Senator David Perdue of Georgia says “the border-adjustment tax is dead on arrival. It’s nothing but a tariff.” He echoes the sentiment of his colleague from Texas, John Cornyn, who said it’s “probably dead.”
What happens if the child and dependent care tax credit becomes refundable? The Trump Administration would consider it as a way to deliver more benefits to lower-income families than its campaign version. But TPC’s Elaine Maag explains why even a refundable credit would “do little to help families who have no paid child care expenses (often the case for low-income parents) as well as married couples with only one worker.”
The Main Street Fairness Act is neither on Main Street nor fair. So says TPC’s Steve Rosenthal, who explains that while the law would require “parity” between businesses organized as pass-throughs and those structured as corporations achieving such a goal is very difficult. “Fairness is always in the eye of the beholder but under this bill,” Steve explains, “the tax rate for a billionaire hedge fund manager could be substantially lower than the rate of his or her secretary.”
In California, more money, more problems. The state has stripped the State Board of Equalization of its power, given allegations of financial blunders, nepotism and improper use of civil servants for political benefit. The elected five-member board oversees 30 tax and fee programs that bring in $60.5 billion annually, or about 30 percent of all state revenue. After a recent Department of Finance Audit, Governor Jerry Brown has asked Attorney General Xavier Beccera to investigate the Board.
Will Macron cut corporate taxes? Centrist Emmanuel Macron has been elected president of France. While issues such as immigration got most of the attention. Macron has proposed cutting the corporate tax rate from 35 percent to 25 percent and reducing government spending. Will he pull it off?
In the United Kingdom, another promise not to raise taxes. Labour party leader John McDonnell pledges not to raise income taxes on 95 percent of taxpayers. He said those earning more £80,000 might pay "a modest bit more" to fund public services. The Tories have promised not to raise the VAT.
In Sweden: An economic miracle? Sweden’s finance minister, Social Democrat Magdalena Andersson, has raised taxes and spending on welfare programs since taking the helm in 2014. Sweden has since enjoyed an economic boom. Swedish growth rates topped 4 percent last year with budget surpluses.
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