Why CBO thinks the TCJA will cost $433 billion more than in December. TPC’s Ben Page explains what happened. “Some of the revision is due to CBO’s new, more optimistic, projection of economic growth over the period. But that more positive forecast is only part of the story: Most of the additional revenue loss is simply because CBO now thinks TCJA’s business tax changes will result in bigger tax cuts than earlier forecast.
Minnesota’s House passes a tax plan. The bill, which the state senate will soon consider, would give 2.1 million Minnesotans a tax cut and 140,000 a tax increase. In addition to revising individual and corporate tax brackets, it increases the standard deduction from $13,000 to $14,000 and provides a deduction for up to $30,000 in property taxes. The bill would retain the state personal and dependent exemptions.
Will Arkansas raise its grocery tax? You now pay a 1.5 percent sales tax if you buy groceries in Arkansas. State lawmakers are considering raising that tax to either 3.0, 4.5, or 6.0 percent to cover the cost of more income tax cuts.
A petition for a climate-related tax advances in Portland, Oregon. A county judge has upheld the constitutionality of a ballot petition that would tax large Portland retail stores to pay for a Green Jobs Fund. If the petition drive is successful and the ballot initiative passes, businesses with at least $1 billion in total sales and $500,000 in Portland sales would pay a 1 percent surcharge on sales. Prescription medicine, health care, and many groceries would be exempt. It is not clear how much the tax would raise.
And a petition to repeal a gas tax advances in California. Opponents of a recent gas tax increase turned in over 940,000 signatures to put a repeal of the increase on the November ballot. The law increases vehicle registration fees and raised gas taxes by $0.12 per gallon and diesel taxes by $0.20 starting last November. The revenue supports mass transit improvements.
When it rains, it pours. New York State says President Trump’s personal attorney Michael Cohen owes an additional $185,000 in back taxes, on top of a previous claim of nearly another $100,000. The latest dispute involves Cohen’s and his family’s ownership of 16 New York City taxi cab medallions. Cohen claims that “Taxi King” Evgeny Friedman owes the taxes. Friedman will go on trial next month for allegedly keeping $5 million from a 50-cent fare surcharge that is supposed to benefit New York mass transit.
New Zealand on-line shoppers may soon pay an “Amazon tax.” The nation’s revenue minister hopes to close a loophole that lets shoppers buy low-cost items abroad and not pay the 15 percent tax on goods sold in New Zealand stores. The new system would go into effect in October 2019.
Save Wednesday May 23 for a talk on the TCJA and economic growth and business investment. TPC and the Kellogg School of Management will host an in-depth discussion about the early evidence on economic growth and the prospects for future growth from the Tax Cuts and Jobs Act. Almost five months into the new year, how are last fall’s predictions about the TCJA holding up? And how can Congress improve the tax code to promote economic growth? The morning event will be broadcast live here from 9:30 am to 12:30 pm.
If you’d like to tell us about a new research paper or have any comments about the Daily Deduction, TPC’s summary of the day’s tax news, write Renu Zaretsky at [email protected]. You can sign up here to receive the Daily Deduction as an email newsletter every weekday morning (Mondays only when Congress is in recess) at 8:00 am.
