Dereliction of duty? President Trump tweeted that by failing to cut interest rates next week, the Federal Reserve would be “derelict in its duties.” Trump repeatedly has demanded that the Fed lower rates to negative levels, not seen since the Great Recession in 2008. The Hill notes that a slowing economy and recession jitters do not bode well for the re-election of incumbent presidents.
Headed out the door and raising corporate taxes to cancel student debt. A Department of Education Official has proposed a corporate tax increase to fund federal student debt write-offs The Wall Street Journal reports (paywall) that A. Wayne Johnson would forgive up to $50,000 of each loan, a step that would cancel $925 billion in debt for nearly 37 million borrowers. Johnson also endorsed a tax credit of up to $50,000 for people who already repaid their student loans. He’d fund the plan with an additional 1 percent tax on corporate earnings. Johnson, who was appointed to oversee federal student loans in 2017, calls the system “fundamentally broken.” He is resigning his federal post to run for US Senate in Georgia.
Familiarity breeds contempt: Why do people hate the estate tax but love the wealth tax? in a new essay for TaxNotes (paywall), historian Joe Thorndike concludes: “The estate tax is old, and like many old things, it’s had a long time to make enemies. The wealth tax, by contrast, is new and untested. Unsullied by experience, it remains appealing in theory. But champions of a new wealth tax can learn something from the history of estate taxes: If you promise to create a narrow tax targeting only the very rich, make sure you keep it a narrow tax targeting only the very rich.”
IRS/TPC Research Conference Call for Papers, due December 2. The 10th Annual IRS/TPC Research Conference on Tax Administration will take place on June 18, 2020. Proposals for papers are due on December 2, 2019. Subjects include measuring and influencing taxpayer compliance, estimating costs of compliance, tax complexity, improving tax administration, and understanding the nature and behavior of taxpayers. More information on the call for papers and submitting a proposal is here.
In Turkey, a plan to raise taxes. The Turkish parliament is considering an increase to the top individual income tax rate from 35 percent to 45 percent on annual income exceeding 500,000 liras ($87,000) and other new taxes. Turkey has a budget deficit and next year faces a tough debt repayment schedule.
An update on US-China trade deal talks. So far, China says it would buy at least $20 billion in agricultural products in a year if the two countries reach at least a partial deal. China may buy more agricultural products if future talks are successful.
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