Amazon makes its choice(s). The online retailer selected Long Island City, NY and the Washington, DC suburb of Crystal City, Virginia as its twin “HQ2.” Amazon will get refundable tax credits of $1.25 billion over ten years as well as up to $325 million in cash from Empire State Development in return for its New York investment,. Virginia and Arlington County will kick in up to $573 million in direct subsidies plus another $223 million in transportation improvements.
Are US auto tariffs around the corner? Bloomberg reports that Commerce Department officials are circulating a draft report that assesses whether to impose levies on automobiles, vans, light trucks, and auto parts. President Trump has threatened a 25 percent tariff on imported cars. Commerce has until February send the report to the President.
The TCJA helps corporations reduce debt. The Wall Street Journal citing a (paywall) a new Moody’s report, shows how the Tax Cuts and Jobs Act makes it easier for companies to use foreign cash balances in the US. Corporations must pay a one-time 15.5 percent tax on past profits held in cash overseas but can bring home future earnings without paying additional US tax. The report’s author, David Gonzales, said, “Now these companies are starting to borrow less and still have their normal debt payments go out, so their debt levels are coming down.
Georgia lawmakers are called back to work. Governor Nathan Deal recalled the House and Senate for a special session starting yesterday. Their mission? Decide two issues. First, whether to approve $270 million in state funding for cleanup and recovery costs in the wake of Hurricane Michael. Second, reconsider a tax break on jet fuel. GOP lawmakers nixed the subsidy earlier this year after Delta Air Lines stopped giving members of the National Rifle Association fare discounts.
Nothing like a personal touch. How can a city improve collection of back taxes? City officials in Syracuse, New York partnered with Syracuse University researchers to see what would happen if officials wrote and signed thousands of notes instead of sending form letters. They sent the hand-written notes to residents who owed, encouraging them to pay up. The city collected nearly $1.5 million more than it predicted it would have otherwise.
If you’d like to tell us about a new research paper or have any comments about the Daily Deduction, TPC’s summary of the day’s tax news, write Renu Zaretsky at [email protected]. You can sign up here to receive the Daily Deduction as an email newsletter every weekday morning (Mondays only when Congress is in recess) at 8:00 am.
