He thinks it can. President Trump dismissed concerns that his ongoing feud with Sen. Bob Corker would make it harder for Congress to pass a tax cut. “I’m giving the largest tax cuts in the history of this country. In addition to that, there’ll be reform…And we’ll be adjusting a little bit over the next few weeks to make it even stronger.” But Corker says he’ll oppose a tax bill that loses revenue, which tax cuts do. And Trump’s vow begs the question: Adjustments to what?
They’re behind the plan, and pushing it. A group of more than 30 conservative groups have sent a letter to members of the House in support of the Big Six Unified Framework.
Dems are… not. A group of nearly 100 Democratic House members signed on to a letter urging the Ways & Means Committee to preserve limits on political activity by tax-exempt nonprofits. The Internal Revenue Code’s “Johnson Amendment” prohibits those groups from endorsing or opposing political candidates. President Trump has targeted the rule repeatedly and some Republicans want to include repeal in any big tax bill.
The Unified Framework increases the child tax credit, but for whom? TPC’s Elaine Maag explains that there would be little impact on most families, and low-income families would receive no new benefits. A child tax credit for a child of a higher-income family would be worth up to $1,500, but one for a child in a lower-income household would continue to max out at $1,000.
Is reforming the EITC a better idea? AEI scholars Aparna Mathur and Cody Kallen think so. They compared a CTC expansion with an increase in the Earned Income Tax Credit and found a bigger—and better targeted-- bang for the buck with the EITC: “Holding the cost of the expansion constant…, the EITC expansion results in a larger after-tax increase in incomes for low-income and middle-class households compared to doubling the CTC.”
Some businesses might not use tax savings to create jobs. Reuters contacted 150 medium-sized US companies and asked how they would use tax savings promised by the Trump Administration and GOP congress. Seventeen companies responded, and none said they would hire more people.
Trump, the NFL, and taxes. Yesterday, the president continued his Twitter attack on the NFL, this time saying the league is getting “massive tax breaks” and calling for changes in the "tax law." By day’s end, White House press secretary Sarah Huckabee Sanders was walking it all back, saying the president was referring to state and local tax subsidies for stadiums. That may be dangerous ground, however, since many Trump properties also enjoy local tax breaks.
In Ohio, cities want to sue the state over a change to income tax collection. A coalition of cities in the state say that Governor John Kasich’s two-year budget contains a provision that is unconstitutional. It would require business owners to file income tax returns with the state rather than the municipality in which the business is located. The state would process the returns and distribute the money back to local governments—but charge a half-percentage point fee. The cities argue the provision strips them of home-rule rights. The state says it would save time and money.
In Montana, it’s time to talk tax increases. The state’s GOP-led legislature may consider changes to its taxation of services to better reflect the modern economy—and assure that the state’s two-year budget doesn’t fall into the red. “We’re good at taxing barrels of oil, bushels of wheat, tons of coal,” said Sen. Llew Jones. “We’re not so good at taxing services.”
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