The spending bill edges to the finish. The House passed the $1.3 trillion budget bill yesterday and early this morning, just before 1:00 am, the Senate followed suit (with a little extra drama). The President plans to sign the bill into law later today. In other words: No government shutdown.
The next shoe drops in Trump’s trade war: China will face $50 billion in tariffs. President Trump moved to impose new tariffs on goods imported from China and limit China’s ability to invest in the US tech industry. The White House expects the tariffs, which officials said were worth about $50 billion, would be applicable to about 1,300 different products that will be identified within 15 days. The White House says the levies would have “minimal” impact on consumers. Maybe, maybe not. China has already warned it will retaliate and the Dow-Jones average plummeted 700 points after Trump’s announcement.
The EU’s proposed tax on US tech firms gets two more thumbs down. Politico reports that Senate Finance Committee Chairman Orrin Hatch and House Ways & Means Committee Chairman Kevin Brady have new statements strongly opposing the European Union’s plan to impose a new tax on the revenues of tech companies. Both have objected in the past. So has the Trump Administration.
Curbing stock buybacks. Three Democratic senators, Tammy Baldwin, Elizabeth Warren, and Brian Schatz, would bar public companies from buying back their shares on the open market. They could still do so through a tender offer. Some Democrats are furious that firms are using TCJA tax cuts to buy back stock.
In Memphis, Tennessee: Paper or Plastic? The city council will consider a 7-cent tax on plastic grocery bags. Yet to be determined: Whether the city would assess the tax per bag, or per shopper. Revenue from the tax would largely go toward water improvement projects. Shoppers over 65 or receiving food stamp (SNAP) benefits would be exempt. The goal is to reduce the use of plastic bags by providing a free, paper, substitute. But some shoppers object: “They’re about to tax us to death….When you have a large family and seven cents a bag, that’s a lot. That’s a lot,” she said. Six other jurisdictions have similar taxes while others have banned plastic bags.
A novel idea for federal budgeting… TPC’s Rudy Penner, who directed the CBO during President Reagan’s first term, has a novel suggestion for the new special congressional committee charged with reforming the budget process. He urges the panel to "turn away from the budget process. It is too broken to be repaired.” Instead, he suggests, it should instead “turn to the substance of the problem.” In other words: Suggest “a combination of specific spending cuts and tax increases aimed at reducing future deficits.” What a thought: Reduce the deficit by…reducing the deficit.
News from the IRS. The agency, state tax agencies and the tax industry warns tax professionals to be alert to taxpayer data theft as the April 17 tax filing day approaches. Indeed, tax planners should enhance their data safeguards immediately, given a recent “New Client” scam perpetrated through email phishing schemes.
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