Is a federal spending deal within reach? Congressional negotiators have reached a tentative $1.3 trillion spending deal for 2020. If lawmakers succeed in resolving what Treasury Secretary Steven Mnuchin called a “handful” of issues within spending bills, they could meet a December 20 deadline and avoid a government shutdown.
And how about another tentative deal, between the US and China? The two nations reached a tentative agreement in principle that President Trump formally approved yesterday. The possible pact arrives just in time, as Trump has until Sunday to decide whether to impose tariffs on $160 billion in Chinese imports. Said Derek Scissors of the American Enterprise Institute, “This timing is really weird. Technically, there’s been a deal on the table for the president to sign for some time. What’s changed is they think the president will say ‘yes.’”
Check out the new TPC Presidential Candidate Guide for tax policies. The new tool gives users an understanding of the policy priorities of presidential candidates and how each candidate would leverage the tax code. The online interface shows users how to search over the various proposals. Updated regularly and shaped by the insights and experience of TPC’s experts, the guide includes over 330 tax proposals so far. Users can search by candidate, tax issue, or tax type and easily compare proposals across these groupings.
Speaking of candidate tax policies… The Penn Wharton Budget Model estimates that Sen. Elizabeth Warren’s proposed wealth tax of 2 percent on net worth between $50 million and $1 billion, and a tax of 6 percent on net worth above $1 billion would raise about $2.7 trillion over 10 years without accounting for macroeconomic effects. Warren’s campaign, however, projects that it would raise $3.75 trillion in federal revenue over a decade.
The European Union joins fight against tax on “accidental Americans.” The Council of the EU wrote Treasury Secretary Steven Mnuchin to urge the US to clarify tax rules that affect an estimated 300,000 to 500,000 US citizens who left the US as young children and may be unaware that they owe US taxes as adults. The EU also asked the US to reduce the $2,350 fee to be paid upon renouncing US citizenship and to simplify tax filing requirements.
Japan’s government wants nation’s firms to spend or invest their cash reserves. Japanese firms hold internal reserves of over 460 trillion yen ($4.23 trillion), and weak business spending could hinder Prime Minister Shinzo Abe’s stimulus policy. So, the Japanese government plans to give a 15 percent tax break to mobile phone carriers and other businesses that investing in 5G infrastructure. It also plans to allow businesses to deduct from taxable income 25 percent of investments of up to 100 million yen in start-ups established within the past ten years.
For the latest tax news, subscribe to the Tax Policy Center’s Daily Deduction. Sign up here to have it delivered to your inbox weekdays at 8:00 am (Mondays only when Congress is in recess). We welcome tips on new research or other news. Email Renu Zaretsky at [email protected].
