Coronavirus Relief #3 is now law. Late Friday evening President Trump signed the $2 trillion bill designed protect businesses and households from the immediate effects of the steep drop in economic activity. The signing came on the same day as the government reported an historic one-week growth in unemployment claims. The Committee for a Responsible Federal Budget estimates the package includes $500 billion in loans and other assistance for major companies, cities, and states; $370 billion in aid for small businesses; $450 billion in cash payments and increased unemployment benefits to individuals; $117 billion for hospitals; and $150 billion for states.
What about a fourth stimulus bill? Not for a while, says House Majority Leader Steny Hoyer. The Congress is in recess for at least three weeks, and Hoyer said that the House’s return date will be based on recommendations of scientists and doctors. The House and Senate will gavel in for brief pro forma sessions, but without legislative action this week. A fourth stimulus package remains on the horizon, but likely will await more information about the progression of the pandemic.
If we are at war, should we consider an excess corporate profits tax? President Trump and others commonly use the war metaphor for the battle against the coronavirus. So Tax Notes historian Joe Thorndike wonders if it is time to consider an excess profits tax on those businesses likely to cash in from the pandemic. It has been used in the past, and may make more sense than price controls.
Decades of “endless, unsustainable and rising” budget deficits likely to continue. TPC’s Gene Steuerle and Erald Kolasi review the latest projections from the Congressional Budget Office in their new brief. Even before the COVID-19 crisis, there was no sign of deficit reduction on the horizon. Spending growth for Social Security and Medicare far exceed the expected growth in revenues. Other programs continued to decline as a share of GDP and total spending.
The Daily Deduction will post Mondays until Congress returns.
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, 2020.