“Shall we dance?” TPC’s Howard Gleckman reflects on this week’s Senate Finance Committee hearing with Treasury-secretary designate Janet Yellen. It featured a delicate “deficit dance” among her and several Republican senators. Yellen vowed the Biden Administration would “act big” to boost the economy with tax cuts and new spending without worrying about the short-term deficit effects. Yet, she also said she’d be a “voice of fiscal sanity” when it comes to long-term deficits. GOP members, now that they’re not in power, want to curtail deficits. But they also oppose tax increases. As their dance continues—who’ll lead, and for how long?
TPC Director Mark Mazur temporarily returns to Treasury. Mark has been named Deputy Assistant Secretary of the Treasury for Tax Policy. He is expected to serve in this position until Congress confirms Biden's Assistant Secretary for Tax Policy. Mark held a similar post in the Obama Administration.
Waiting for Biden’s budget? It may take a while. The president usually releases a budget in early February though a new president usually sends Congress a truncated version. But Biden staffers tell Politico that their budget may take longer, blaming the lack of transition cooperation from Trump budget officials.
In New York, will the wealthy pay higher taxes? In his 2022 budget proposal designed to reduce the state’s deficit, Governor Andrew Cuomo advocates for a tax increase on high-income New York State residents. Their top income tax rate would rise from 8.82 percent to 10.86 percent. New York City residents would pay a top rate of 14.7 percent in state and local taxes. That would be the highest income tax rate in the country.
In Washington State, a steep gas tax increase? The state’s House Democrats have proposed a $27 billion, 16-year program aimed at reducing carbon emissions. It would start by raising the state’s fuel tax by 18 cents per gallon over two years. Along with existing state and federal gas taxes, the rate would hit 85.4 cents per gallon, the highest in the country. The additional tax revenue would fund road maintenance and electrification of the state’s diesel ferries. The gas tax hike could be followed by a carbon tax that initially would result in an additional 15 cent per gallon tax at the pump.
The story that never ends: About Trump’s unreleased tax records… Former President Donald Trump’s personal attorneys have asked for a conference with a federal judge to discuss how to proceed with the House Democrat’s request for Trump’s tax returns. Trump’s attorneys worry that the Biden Administration might hand over the returns without giving Trump advance notice.
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].
