Calculating the price of the now-ended shutdown. On Friday, President Trump signed a temporary funding bill to reopen the government through February 15. The bill does not include any money for Trump’s desired border wall. The 35-day-long shutdown cost the US economy at least a $6 billion, according to S&P Global Ratings.
Reopening the IRS. While agency staffers are back at work (and being paid) the IRS must confront a backlog of taxpayer correspondence, get IT systems up and running, and hire and train thousands of temporary workers to respond to taxpayer queries and process returns. The Washington Post reports that the National Taxpayer Advocate estimates it could take a year or more for the IRS to resume normal operations.
How big will tax refunds be under the new tax law? The Wall Street Journal delves into the question (paywall) at the start of the tax filing season, the first under the Tax Cuts and Jobs Act. In a nutshell: Refunds on average will be larger than usual, but will vary, especially given the added confusion over withholding changes resulting from the 2017 law.
Should the House obtain and release the president’s tax returns? According to a new ABC News/Washington Post poll, 6 in 10 say House Democrats should use their authority to obtain and publicly release Trump’s tax returns. House Ways & Means Chair Richard Neal is moving deliberately—too slowly for many Democratic activists.
Rhode Island Governor Gina Raimondo wants an online sales tax collection bill. Revenues are lagging, but the state could collect $11.5 million in sales tax from remote sellers who rely on online platforms like Amazon. The state already requires direct online sellers to collect sales taxes but the Democratic governor wants the legislature to allow the state to collect the additional sales tax by the end of March.
What do states and localities do with their tax revenue? TPC’s Tracy Gordon offers comfort in the wake of a partial federal government shutdown: Federalism! You can get up to speed on what states and localities do to raise revenue thanks to updated entries in TPC’s Briefing Book.
What to do with carbon tax revenue? TPC’s Howard Gleckman writes that a carbon tax will never be possible unless the public supports the way the government uses its revenue. The revenue could help reduce the deficit, but not if it’s “earmarked for other priorities—whether a rebate, environmental policy, or other initiatives.”
January 29 at TPC: How Are States Responding to the TCJA? TPC, the American Tax Policy Institute, Tulane University, and the University of Tennessee host a conference to examine state responses to the 2017 tax cut. Topics will include conformity of state and federal individual and business tax bases, international business as a source of state revenue, and state workarounds to the TCJA’s limit on the deduction for state and local income taxes. Register here for the day-long event. The event will be webcast here beginning at 9:30 am.
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].
