Senate passes omnibus spending bill. The Senate passed the $1.7 trillion bill that would fund the federal government through Sept. 30 and create new retirement savings incentives. The bill now goes to the House, which is expected to approve it today.
Why was the IRS so slow to audit Trump’s tax returns? Two congressional reports this week describe the agency’s delayed examination of the former president’s returns and weaknesses in its review. But TPC’s Howard Gleckman says a key fact is missing: Why? Was it political influence, a lack of resources, or something else? It is in the agency’s best interest to provide an answer.
House bill would require IRS audits of presidential tax returns. The House quickly passed a bipartisan bill to require the IRS to audit presidential tax returns “as rapidly as practicable.” The agency would publicly report its initial findings within 90 days and make periodic reports as its examination is completed. Currently, the agency has internal guidelines for mandatory audits of presidential tax returns, but they are not backed up by statute. The IRS has been criticized for failing to audit former President Trump’s returns in a timely way. The Senate has not considered the measure.
Indiana lawmakers plan for a future without income taxes. State Senator Travis Holdman proposed a commission to analyze how to restructure Indiana’s tax system once the state pays off its $8.8 billion pension debt in 2030. That unfunded liability is for teachers who retired before 1996. Indiana is already cutting its 3.23 percent individual income tax rate to 2.9 percent over the next seven years.
The NFL can still thank taxpayers for billions of dollars in renovations and construction of stadiums. CNBC takes a closer look at the use of public funds to build professional sports stadiums. Since 2000, taxpayers have spent $4.3 billion, to pay off tax-exempt municipal bonds that fund the facilities. Despite some bipartisan support to bar the use of tax-exempt bonds to fund professional sports venues, no proposal has yet become law.
MIT researchers ask: Should we tax robots or imports? A new study finds a modest tax on robots ranging from 1 percent to 3.7 percent of their value could help curb the effects of automation on income inequality. The Massachusetts Institute of Technology economists also projected that an import tax of between 0.03 percent to 0.11 percent could curb the effects of foreign trade on US jobs. The paper, “Robots, Trade, and Luddism: A Sufficient Statistic Approach to Optimal Technology Regulation,” appears in advance online form in The Review of Economic Studies.
Save the date for TPC’s Prescription on Jan. 5. Jacob Bastian, assistant professor of economics at Rutgers University, will discuss his research on the 2021 expanded child tax credit. His work challenges claims that the additional benefits prompted people to work less. Learn more and register here.
Massachusetts High Court: Cookies and apps do not create sales tax nexus: In US Auto Parts Network v. Commissioner of Revenue, the justices ruled that a firm’s cookies and apps on a customer’s phone do not constitute nexus for the purpose of state sales taxes. It said the Massachusetts Appellate Tax Board appropriately concluded the business did not have to collect state sales tax from customers who used its app. The Court also ruled the US Supreme Court’s Wayfair decision should not apply retroactively.
EV tax credit guidance won’t come until March. Treasury is delaying its release of proposed guidance on which batteries will comply with the Inflation Reduction Act’s $7,500 electric vehicle tax credit. EV manufacturers worry they may not be able to meet the US-source rules in the new law and US trading partners have strongly objected to what they see as protectionism. President Biden has promised to address those concerns.
The Daily Deduction will publish on Tuesday, December 27, and Tuesday, Jan. 3. It will resume its regular schedule when Congress returns. Happy Holidays!
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