Republicans weigh tweaks to ACA premium tax credits. Tax Notes reports that House Ways and Means Committee Republicans are split on whether to extend the enhanced Affordable Care Act premium tax credits, which expire at year’s end. Some moderates favor a bipartisan extension through 2026, but others criticize the credits as costly and prone to fraud, particularly for higher-income households. Democratic leaders, meanwhile, insist the credits must be addressed in any government funding deal this month, warning that premiums could spike during open enrollment without Congressional action.
Massachusetts group warns of healthcare revenue hit from OBBBA. According to a bulletin from the Massachusetts Taxpayers Foundation, provisions in the One Big Beautiful Bill Act (OBBBA) could cost the state’s healthcare system $70 million annually. The law restricts the use of Medicaid provider taxes and eliminates premium tax credit eligibility for certain groups, including asylum seekers and some low-income noncitizens. The foundation estimates 80,000 people will lose eligibility for credits, adding to fiscal pressures on the state budget.
Oregon considers decoupling from federal GOP tax cuts. The Oregon Capital Chronicle reports that Oregon lawmakers are debating whether to suspend the state’s automatic conformity with federal tax law to avoid losing hundreds of millions in revenue. Federal changes enacted in July, including eliminating taxes on tips and overtime pay and expanding immediate expensing, could cut state revenues by $400 million in 2025 and $888 million over the following two years if adopted automatically. Lawmakers may call a special session before year’s end to consider decoupling, but some provisions, such as the “no tax on tips” policy, may be politically difficult to forgo.
India’s IT sector uneasy over proposed US outsourcing tax. Reuters reports that India’s $283 billion information technology industry is bracing for disruption after Sen. Bernie Moreno (R-OH) introduced a bill proposing a 25 percent tax on US companies that outsource work overseas. The proposal, part of the HIRE Act, would also bar firms from deducting outsourcing expenses, potentially raising combined tax liabilities to as high as 60 percent in some cases. Analysts say the measure faces political and legal hurdles but could slow contract renewals and spark pushback from American businesses heavily reliant on overseas IT services.
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