President Biden awaits more details on bipartisan infrastructure bill. The White House continues to support either reconciliation or other legislation to advance its priorities. But it seems to cooling to the still-developing bipartisan Senate plan. White House spokesman Jen Psaki said the bipartisan package lacks sufficient detail, including specifics about how to pay for it. Senators say they hope to finalize their plan by the end of the week.
What about a VAT? CNBC reports on the state of the value-added tax (VAT), a duty on goods and services at each step along the supply chain. TPC research by Bill Gale notes that the VAT is the third-largest revenue producer for the Organization for Economic Cooperation and Development—“a workhorse of the European tax systems.” But in the US, it’s seen as regressive by Democrats, too broad a tax increase by Republicans, and unfair by many states.
Watch those bank accounts: Some families will need to pay back some of their enhanced child tax credit. The bigger child tax credit (CTC) included in the American Rescue Plan provides up to $3,600 per child. But recipients will need to repay the IRS if they receive more money than they should.
New Jersey Gov. Phil Murphy and lawmakers reach tax relief agreement for 2022. The state will provide a $500 tax rebate to more than 760,000 families. The plan expands the Child and Dependent Care Credit by making it refundable and available to families making up to $150,000. It also expands the Earned Income Tax Credit by making more people eligible, including those between ages 18 and 21 and those 65 or older without dependents.
With a budget surplus on the horizon, North Carolina state senate leaders opt for tax cuts. Yesterday the Senate unveiled a $25.7 billion spending proposal that they say will lower the median North Carolina household's tax bill by 37 percent. The plan does not increase spending, but lowers the individual income tax rate from 5.25 percent to 3.99 percent over five years. An earlier budget proposal, developed before news of a bigger budget surplus, proposed a 4.99 percent tax rate.
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