Tax policy and clean energy: Does the IRA try to do too much? TPC’s Howard Gleckman argues that while the Inflation Reduction Act takes important steps toward reducing CO2 emissions in the US, it keeps the US on a relatively inefficient path to cleaner energy. The more than $200 billion in energy-related tax subsidies, he says, lose some of their environmental punch because they come with “Buy America” and labor rules that could raise costs of green energy and dampen demand for those products.
Thursday’s TPC Prescription: the IRA’s clean energy incentives. Ben King, Associate Director of Rhodium Group's Energy & Climate practice, will talk with TPC’s Howard Gleckman about the IRA’s clean energy incentives. How close will the new law come to meeting the US emissions reduction target? Learn more and register for the noontime event on Aug. 25 here.
The IRA’s buyback excise tax snares foreign investors. TPC’s Steve Rosenthal describes how the tax on US publicly traded corporations affect investors, including foreign shareholders. Steve says the tax will encourage companies to use excess cash to pay more dividends rather than repurchase stock. Foreign investors, who own about 35 percent of total US corporate equity, will pay more US tax since they only pay US taxes on dividends received. He concludes that lawmakers might reconsider recent tax rate cuts for US corporations and other corporate tax rules that favor foreign investors.
Virginia has a budget surplus, Gov. Youngkin promises more, but unspecified, tax cuts. The state concluded its fiscal year with a surplus of $3.2 billion. Some money has been budgeted for highway maintenance and the rainy-day fund. But Youngkin, a potential Republican presidential candidate in 2024, has promised to set aside $397 million in unspecified tax cuts.
As the Trump world turns: Tax evasion, tax returns… Former Trump Organization chief financial officer Allen Weisselberg pleaded guilty to multiple tax fraud charges last week. He agreed to pay nearly $2 million in taxes, interest and penalties and serve five months in jail. Meanwhile, the DC Circuit Court of Appeals ruled the House Ways and Means Committee can obtain former President Donald Trump's tax returns from the IRS. Trump says he will appeal.
Kanpai! to tax revenue? Last month, Japan’s National Tax Agency launched a “Sake Viva” competition to learn how to “revitalize” its liquor industry. Tax revenue from liquor sales was only $8 billion in fiscal year 2020, down 13 percent from 2016. Consumption of taxed alcohol fell nearly ten percent over the past decade, due to more health-conscious consumers, an aging population, and changing tastes among the young. The agency told Bloomberg News that the competition is designed to encourage industry growth and “in no way is it encouraging people to drink excessively.”
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