Border-adjustable tax: Still on the ropes. Some Republicans think it’d be easier to score a quick win by cutting taxes this year, and not struggling over messier tax reform. So conservatives continue to pressure GOP leaders to ditch a plan to tax imports and exempt exports. They are even urging the leadership to cancel the August recess, so that lawmakers can craft a plan. But don’t ditch that beach vacation just yet.
What if Germany cut its VAT? The government may reduce its 19 percent value-added tax and some backers of the idea think it will help reduce the nation’s big trade surplus—a matter of some tension with President Trump. But Germany’s economic ministry says cutting the VAT would do little to reduce the current account surplus.
Some Arizona business leaders want to raise a tax. Voters approved a 0.6 percent education sales tax in 2000 though Proposition 301 but it expires in 2021. Business leaders want to expand it, saying a boost to 1.5 cents could raise an additional $900 million a year for teacher salaries, full-day kindergarten, school infrastructure, teacher training and workforce development. They’re trying to get other businesses to help bankroll a new ballot initiative, though they haven’t yet specified its language.
Online sellers sue Massachusetts over sales tax rule. To the surprise of no one, a trade group representing online retailers overstock.com and eBay has sued the Bay State to block a creative, but controversial, plan to require nearly all e-tailers to collect Massachusetts sales tax. The state’s theory: A seller’s apps and cookies sitting on a state resident’s computer or phone constitute physical presence, or nexus, that is necessary to require a firm to collect state taxes. The new rule is scheduled to take effect in July.
No SOS needed for the MID. Tax historian Joe Thorndike, writing for Tax Analysts, considers the status of the mortgage interest deduction in current tax reform talks. Will it go away? “This year Republican plans for tax reform have triggered another round of hand-wringing by real estate interests. And once again, a rising standard deduction lies at the heart of their fears. But history offers scant reason for fear (or hope, if you’re a reformer).”
Why don’t more eligible Asian Americans make use of the EITC? As TPC’s Yifan Zhang explains: “Typically, this occurs because families are unfamiliar with the program and therefore less likely to claim its benefits…American families in general are becoming more and more complex, so as the Trump administration considers changes to the program, factoring in the Asian American experience may allow lawmakers to accommodate complex family arrangements when revising the tax law.”
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