Treasury Secretary tells Senate Finance Committee: Inflation is global; domestic policies can help Americans. Treasury Secretary Janet Yellen acknowledged yesterday that the US faces “macroeconomic challenges, including unacceptable levels of inflation.” She said the Administration likely would increase its inflation forecast and called on Congress to ease the cost burdens that households face. She called the problem global, exacerbated by Russia’s war in Ukraine. The World Bank, meanwhile, warned the world risks stagflation.
Is the global tax deal in trouble? The New York Times reviews the now shaky status of the deal, due to political fights here and abroad.
And Germany’s finance minister rejects an oil industry’s windfall profits tax. Finance Minister Christian Lindner says that such a tax would do only harm and could fuel inflation.
New cryptocurrency bill introduced. The Responsible Financial Innovation Act (RFI), was introduced by Democrat Sen. Kirsten Gillibrand of New York and Republican Sen. Cynthia Lummis of Wyoming. They say it “will create a workable structure for the taxation of digital assets and cryptocurrencies and will provide a regulatory sandbox for state and federal regulators to collaborate on innovative financial technologies.” But TPC’s John Buhl warns the bill includes a huge, unnecessary tax break for crypto miners and stakers.
Will economic well-being last? The Federal Reserve found economic well-being improved in 2021. But TPC’s Elaine Maag worries that it may not continue into 2022, especially if the job market slows and government supports for low-income households are not extended.
Tune in this morning to learn about international spillovers in tax policy. At 10:30, TPC hosts a virtual event featuring keynote speaker Roseanne Altshuler. She’ll address international tax spillovers and the roles played by home countries, host countries, and multinational corporations. Two expert panels will discuss how the US corporate tax has affected intellectual property location and how the US can design a carbon tax that minimizes shifting production to countries with lower carbon prices. Watch here.
Pennsylvania House Finance Committee approves medical marijuana tax relief. Part of a broader tax package, the provision would allow medical marijuana businesses to receive state tax deductions for expenses currently prohibited under federal tax law.
In two weeks: Machine learning and tax enforcement? In 2017, the IRS adopted techniques including data mining and clustering to find fraud and other types of noncompliance by individuals claiming tax refunds. The Biden administration’s proposal to increase the IRS’s budget by $78 billion over the next decade includes some additional funds to further develop machine learning to improve the agency enforcement. On June 22, tune in for a TPC event on how machine learning can detect noncompliance, and the implications of using artificial intelligence and emerging data technologies on society and governance.
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].
