Disney, DeSantis and that special tax district. After the Walt Disney Corporation criticized a new Florida law that bans discussions of gender issues in many public school classrooms, Gov. Ron DeSantis retaliated with legislation to dissolve a special taxing district managed by Disney since 1967. Disney pays about $163 million a year to the district but controls its public services. Now the district’s financial obligations, including $1 billion in debt, will shift to local governments, potentially raising individual property taxes by $2,500 a year. DeSantis has not canceled $578 million in state tax credits that Disney can use to reduce its income taxes through 2040, because other corporations are eligible for such credits, too.
Arizona Supreme Court: Arizona voters can’t reject a state income tax cut. Last year Republican Gov. Doug Ducey signed a nearly $2 billion income tax cut that mainly benefits the wealthy. Education advocates collected enough signatures to block the tax cuts until after a November referendum. While a lower court ruled in favor of the advocates, the Arizona Supreme Court quickly overturned that decision without explanation, saying a full opinion will be released later.
Supreme Court says Puerto Ricans can be exempted from federal benefits. The US Supreme Court ruled that because Puerto Ricans pay little or no federal income tax, they can be excluded from federal Supplemental Security Income benefits. Writing for the majority, Justice Brett Kavanaugh said the federal income tax exemption is a rational basis for excluding them from eligibility for SSI payments. Justice Sonya Sotomayor, dissented. She said if Congress can exclude citizens from safety net programs because they don't pay sufficient taxes, residents of several states could also be blocked from getting federal benefits.
Former Senator Orrin Hatch has died. Sen. Hatch chaired the Finance Committee from 2015 to 2019, when he retired after shepherding the 2017 Tax Cuts and Jobs Act into law. Over his 42 years in the US Senate, more of his bills were enacted into law than any other senator’s. Early in his career, he championed bipartisan legislation with Sen. Ted Kennedy and others including the Americans with Disabilities Act, the Children’s Health Insurance Program, a law that created the generic drug industry, and one that slapped health warnings on cigarette packs. Sen Hatch also was a long-time supporter of a balanced budget amendment to the Constitution.
Today at noon: What can the US learn from tax reform in developing countries? TPC’s Seventh Annual Donald C. Lubick Symposium begins with remarks by Ambassador Stuart Eizenstat and Phil West. Then, Mary Baine of the African Tax Administration Forum, Victoria Perry of Oxford University, and Artur Swistak of the International Monetary Fund will discuss their work reforming tax systems. You can register for the event here.
A perspective: The American retirement system is built for the rich. The Securing a Strong Retirement Act, or Secure 2.0, expands tax breaks for individual retirement accounts and 401(k) retirement plans. University of Chicago Law School professor Daniel Hemel says in a Washington Post column that the law worsens the inequities of the status quo, and while it has been scored as revenue neutral over 10 years by the Joint Committee on Taxation, it will cost taxpayers billions of dollars in the long run.
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