Up next week: Tariffs on goods from Mexico. President Trump says it would be foolish for congressional Republicans to formally disapprove his tariff increases, including his plan to levy a 5 percent import tax on Mexican goods starting June 10. Should there be no progress to his satisfaction at the southern border, Trump says he’d raise tariffs to 25 percent by the end of the year. Secretary of State Mike Pompeo and Mexican officials are meeting today to try to resolve the flap. Meanwhile, Fed Chair Jerome Powell says the central bank would lower interest rates if the trade war begins to hurt the economy.
Uber is under federal tax investigation. The IRS is focusing on tax years 2013 and 2014. The ride-hailing company said in its 10-Q filing that other state and foreign tax authorities are examining its taxes as well. Uber may have reduced tax liabilities by shifting income to lower-tax jurisdictions.
But it may not have to pay much. The Treasury Inspector General for Tax Administration reports that the IRS often settles for far less than corporations owe in back taxes and penalties. It reported that while the IRS’s Large Business and International Division recommended that 519 firms pay $1.8 billion in penalties from 2015-2017, 308 corporations appealed and nearly all got fines reduced or eliminated.
Joe Biden has a climate plan and a way to pay for it. The Democratic hopeful would reverse the corporate tax cuts enacted under the Tax Cuts and Jobs Act to invest $1.7 trillion in clean energy research and reach net-zero emissions by 2050. His campaign expects the initiative would generate more than $5 trillion in state, local, and private investments to address climate change.
Pew Study: The Great Recession’s hangover continues in many states. It illustrates ten ways in which states still are suffering from the effects of the 2007-2009 downturn, even while the nation enjoys an economic recovery. Among them: State funding for higher education is down by 13 percent; state funding for K-12 education is down in 29 states; and state investment in infrastructure is the lowest it’s been in 50 years.
Amazon has had a big impact on Ohio’s sales tax revenue. In 2015, state sales collections climbed by $320 million in the six months after Amazon began collecting Ohio sales tax on remote purchases— a 6.1 percent jump. Ohio had estimated that Amazon would collect between $150 million and $350 million a year. In 2018, clevand.com estimates that Amazon collected $310 million. Today, if Amazon weren’t collecting sales tax, Ohio would need to raise its sales tax rate from 5.75 percent to 5.95 percent to make up the difference.
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