The President seeks Democratic votes on tax reform. For now. Hill GOP leaders still plan to use budget reconciliation to pass a Republican-only tax overhaul. But President Trump continues his recent romance with congressional Democrats. Last week he hinted to a bipartisan group of House members (the Problem Solvers caucus) that he might tie a tax bill to a big infrastructure plan—a longstanding Democratic wish. But what else will be in the bill? President Trump says he’ll work with Democrats to make sure the wealthy either pay the same or more in taxes. But top White House aides and Hill Republicans say the wealthy will get a tax break. They promise more details next week.
Will tax reform be SALT free? Many Republicans in Congress want to eliminate the state and local tax deduction to help pay for tax rate cuts, much to the dismay of GOP legislators in Democratic-leaning states. TPC’s Steve Rosenthal tells The Washington Post, “I think it will have better legs this time. Republicans need to close a few loopholes and need to hit the rich in some way in order for the package to extend the narrative that [tax reform is] not just a windfall for the rich. And the noisier the blue-state politicians are at objecting to these loopholes, the better it plays into the narrative.”
Iowa’s bait-and-switch property tax cut. Iowa passed property tax reform four years ago. State officials promised that commercial taxpayers would save $218 million this year and that the state would reimburse local governments for any lost revenues. The Des Moines Register analyzed state data and finds that while commercial properties saved about $125 million, local governments have lost $107.2 million.
California or bust? The California legislature passed a bill that would require presidential candidates to share their five most recent years of tax returns to earn a spot on the state’s ballot. If the governor signs the bill and it withstands legal challenge by Republicans, President Trump could appear on the California primary and general election ballots in 2020 only if he turns over his returns.
Ten EU Finance Ministers back tax plan for tech giants. The plan requires major digital technology firms like Google, Amazon, and Facebook to pay tax on revenues to any country where they conduct business. Right now, the companies pay tax to the countries in which they report their profits—like low-tax Ireland. All member states of the European Union must agree to this plan for it to move ahead, so the EU will take up the issue again at their December meeting.
Tomorrow: Hearing on business tax reform. The Senate Finance Committee holds a hearing tomorrow to examine how to improve the tax code’s business provisions. Witnesses include TPC’s Donald Marron, the Tax Foundation’s Scott Hodge, Troy Lewis of the American Institute of CPAs, and the Real Estate Roundtable’s Jeffrey DeBoer.
