New York City faces a nearly $10 billion deficit, and a fiscal crisis is on its horizon. Tourism and job losses have not yet recovered from the pandemic. City officials expect business tax revenue to decline for the first time in six years and personal income and related tax revenue will fall by 7.7 percent, the largest drop in a dozen years. They forecast city revenues will fall this year and next — the first two-year decline since 1980.
Idaho tax collections fell below expectations last month. The state fell short in August by $38.5 million in individual income taxes, sales taxes, and corporate income taxes. It’s a small share of Idaho’s $6 billion budget, and the state still projects a budget surplus of about $1 billion. Nonetheless, state officials are worried.
Massachusetts communities consider transfer fees and luxury real estate taxes to fund affordable housing. Boston and seven others have passed home-rule petitions asking the state to permit them to levy a surcharge on high-end real estate. For example, Boston Mayor Michelle Wu proposed a 2 percent tax on property sales exceeding $2 million. It would have raised $100 million last year for affordable housing, according to city officials.
Ways & Means will boosting Social Security benefits for public employees. The Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) provisions were created to treat workers who were not covered by Social Security for some jobs comparably to workers who were covered by the program over their careers. These are mostly public employees who receive public pensions. The bill would increase Social Security benefit costs by about $150 billion over 10 years.
Canada cracks down on multinationals’ tax avoidance. The Department of Finance is tightening over a dozen tax laws, increasing corporate information reporting, and devoting more resources to collections. Practitioners predict it will be less likely multinationals will win court cases involving tax avoidance.
Economically vulnerable countries seek “climate-related and justice-based” taxation. In a paper to be presented to the UN general assembly, some of the world’s most vulnerable countries want financial support to offset their climate-change-related losses. Funds could be raised, they claim, through a global carbon tax, a tax on airline travel, a levy on carbon-intensive bunker fuels used by ships, adding taxes to fossil fuel extraction, or a tax on financial transactions.
Colombia may soon see tax hikes. Colombian President Gustavo Petro has secured sufficient legislative support to pass $5.6 billion in tax hikes. The bill would raise taxes on the wealthy, sugary drinks, processed foods, and single-use plastics; remove certain corporate tax exemptions; and increase export taxes on oil and gas.
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