Will the Senate vote next week on a budget resolution? Senate Majority Leader Chuck Schumer predicts a vote next week on a budget resolution, the first step toward passing President Biden’s $1.9 trillion pandemic relief plan. House and Senate Democrats tentatively plan to introduce a budget resolution on Monday and vote on it later in the week. The resolution would be the initial step in the budget reconciliation process that would allow Senate Democrats to pass a version of Biden’s plan without GOP votes. Separately, some Democrats are working on a compromise with moderate Republicans that could pass as a stand-alone bill.
What about the SALT deduction cap? Will the final Democratic plan ditch the federal cap on state and local tax deductions? Some high-tax state Democrats are demanding it, but it is unlikely to pass the Senate.
Nebraska Gov. Pete Ricketts pushes property tax cap to state legislature’s revenue committee. He’d limit the growth of local property tax collections to 3 percent per year. Voter-approved bond measures would be excluded. Over the past ten years, property taxes in Nebraska have climbed by nearly 52 percent while overall state income has grown by 48 percent and inflation has grown by 18 percent.
Alabama business will need to pay higher unemployment taxes. The taxes will nearly double this year due to the unprecedented amount of unemployment benefits paid during 2020. The Alabama Department of Labor will send out final tax notices for 2021 that will raise the rate by 92 percent from an average of $52 per employee to $100 or more.
Will Mississippi eliminate its tax on groceries? With a 7 percent sales tax on food, the state levies the nation’s highest tax on groceries. Democrats in the state legislature have sponsored several bills to reduce it. One Mississippi House measure would phase out the tax over seven years. Two Senate bills would immediately exempt groceries. The tax generates $265 million annually. For now, the chair of state’s GOP-controlled House Ways & Means panel is open to discussing the grocery tax.
Taxing big tech (still) might not be quick and easy. Finance officials from 137 member nations of the Organization for Economic Cooperation and Development (OECD) are wrapping up the latest round of talks on how to keep multinational companies from shifting profits among countries to avoid taxation. One big question: How will they tax tech firms that earn income but have no on-the-ground presence in a country? Those firms conduct business through digital activities, and earn revenue from online advertising, sale of user data, search engines, or social media platforms. Absent a unified approach, individual countries will continue to levy digital taxes on their own, steps that could that spark a trade war. OECD Secretary General Angel Gurria wants a deal by summer.
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