OECD tax chief resigns. Pascal Saint-Amans, a driving force behind the push for a global minimum tax, will leave his post as head of tax for the Organisation for Economic Cooperation and Development at the end of October. He told Politico that he remains confident the agreement will be formally adopted by member nations. “I wouldn’t leave if I had assessed that the project badly needed me. I believe this will happen. The question is, will it happen in an orderly manner, or with some hiccups.”
Germany will press ahead with its 15 percent global minimum corporate tax. The government will start preparing domestic rules to enforce the levy. Insiders see the move as a way to pressure Hungary, which has blocked the European Union from adopting the global tax, to sign on.
France backs EU-wide windfall tax on energy companies. It’s the latest nation to support an effort to tax the profits of energy companies in the European Union. French President Macron, following a call with German Chancellor Olaf Scholz, told reporters, “It’s the approach that France and Germany support.”
Majority of tax officials believe big four accounting firms try to exploit tax loopholes. The Financial Times reports (paywall) on an OECD study that finds a majority of tax officials think Deloitte, EY, KPMG, and PwC were more likely than local accounting firms to advise their clients to use aggressive tax strategies. It added that government officials also believe the Big Four promote artificial tax planning strategies. Only a quarter of tax officials believe the accounting firms consistently follow spirit of the law.
No US-made EVs may be eligible for the full new tax credit. Research firm Fitch Solutions estimated that no US-made electric vehicles will qualify for the full $7,500 tax credit in the short term. The Inflation Reduction Act expanded the credit but said the full tax break would be available only when at least 40 percent of a vehicle’s battery materials are sourced from the US or free trade partners. Right now, China accounts for over 70 percent of global electric vehicle battery materials.
Setting battle lines for a CR. The Biden Administration is pushing Congress to include $47 billion in extra emergency funding for COVID-19 vaccines and testing, monkeypox, military aid to Ukraine and natural disasters. Republicans are likely to resist most of it.
West Virginia Gov. Jim Justice pressures legislature to pass his tax cut. His plan competes with Senate President Craig Blair’s version. Justice would set the personal income tax rate at 10 percent, while the Senate’s Republicans prefer to eliminate tangible personal property taxes and then phase out personal income taxes later, contingent on 5 percent increases in sales tax revenue.
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].
