“Think he’ll move that rubber tree plant?” Senate efforts to repeal the Affordable Care Act (and its taxes) are dead in the water. After his Better Care Reconciliation Act collapsed on Monday night, Majority Leader Mitch McConnell urged his colleagues to vote to repeal the ACA now and tackle a replacement sometime later. But within hours yesterday, three Republican senators--Shelley Moore Capito (W.Va.), Susan Collins (Maine) and Lisa Murkowski (Alaska)—said they wouldn’t even allow debate on that idea. Back to the drawing board. Or on to the next thing.
“Anyone knows an ant can’t move a rubber tree plant…” Onward to tax reform, if the budget allows. Vice President Pence assured the National Retail Federation that President Trump "is going to work with this Congress this year, and we're going pass the largest tax cut since the days of Ronald Regan.” This could be a problem since the House Budget Committee’s fiscal plan requires a revenue-neutral tax bill, as TPC’s Howard Gleckman explains. Meanwhile, House committees need to find $203 billion in savings from mandatory federal programs including food stamps over the next decade. TPC’s Frank Sammartino lays out three main takeaways from the President’s budget here.
“When troubles call and your back’s to the wall, there a lot to be learned, that wall could fall…” The nominee for Treasury’s assistant secretary for tax policy has some regrets. In a hearing yesterday, the former director of Ernst & Young LLP’s national tax practice, David Kautter, said he was not involved in the firm’s decision to create tax shelters, nor did he design or draft any. “Looking back,” he told the Senate Finance Committee, “I should have been more active.” Ernst & Young faced penalties for marketing shelters that, according to the IRS, cheated Uncle Sam out of billions of dollars in taxes.
“Once there was a silly old ram, thought he'd punch a hole in a dam.” Washington State’s GOP lawmakers urge some Seattle residents not to pay their taxes. The city passed an income tax on its wealthiest residents, but state Republicans are urging them to “forcefully resist.” They shouldn’t pay, they say, because the tax may be ruled unconstitutional in an upcoming legal battle.
“High hopes… high apple pie, in the sky hopes…” Massachusetts lawmakers agree on a pot tax hike. The House and Senate struck a deal that would require consumers to pay a 10.75 percent excise tax on top of the state’s regular 6.25 percent sales tax. Cities and towns could also add a 3 percent local tax. Republican Governor Charlie Baker has not objected to the agreement.
“All problems just a toy balloon… they’ll be bursted soon.” Canada’s government sets its sights on a tax loophole. Finance Minister Bill Morneau wants to curb the ability of professionals such as doctors and lawyers to reduce their tax rate by incorporating. Closing this loophole, in addition to others, could raise at least C$250 million annually.
“Oops there goes another problem—kerplop.” India’s retailers get to know the pain of paperwork. With the nation’s new goods and service tax, retailers face complicated documentation requirements and product classifications that determine taxes. The new rules have prompted e-commerce sites to drop thousands of small merchants from their rolls since they can’t meet the new requirements.
