Though it depends on who you ask. Speaker Kevin McCarthy predicted earlier this week that he’d be able to strike a deficit reduction deal with President Biden in exchange for raising the debt limit. But Senate Majority Leader Chuck Schumer said yesterday that both Biden and he are firm in their position that House Republicans need to prove they have the votes to pass spending cuts. As yet, House Republicans have not released a plan for any cuts.
New OECD rules give US companies a temporary reprieve from higher taxes. The Organization for Economic Cooperation and Development outlined how the US tax system will interact with minimum taxes going into effect in the European Union, United Kingdom, South Korea, and other countries. The US has not yet passed legislation aligning itself with the agreement.
Speaking of renewable energy, EV tax credits are working well in the US. Axios reports that new tax credits available to carmakers are helping boost domestic battery manufacturing as intended. The value of those tax credits may be four times higher than Congressional Budget Office estimates of about $30.6 billion over ten years due to a surge of new battery plants across the country, according to a Benchmark Mineral Intelligence report prepared for Axios.
Texas sales tax revenues hit an all-time high. The Texas Comptroller reported state sales tax revenue totaled $4.11 billion in January, 6.6 percent more than in January 2022. Most of January’s revenue is based on sales made in December and remitted in January.
Iowa’s senate passes a bill to avoid a property tax increase, but local governments may feel a pinch. The Iowa Department of Revenue published tax rates in October that local governments use to set their budgets, but that rate—which would lead to a $127 million tax increase—was apparently incorrect.The state Senate passed a bill this week that corrects the error, but local governments have already set their budgets. The bill would extend the March 31 budget deadline for local governments to April 30 to give them time to make changes.
Washington State launches new Working Families Tax Credit. The benefit gives qualifying families between $50 and $1,200, depending on income and number of children. A filer must also be eligible for the federal Earned Income Tax Credit.
New York tax break may not reach those eligible. A new state law allows homeowners aged 65 or older (who earn less than $50,000 a year) to cut their property taxes in half. The limit used to be $37,000. But the county, town, village or school district has to opt into the new income threshold. Taxpayers and taxing jurisdictions have until March 1 to decide whether to use the new threshold. If jurisdictions pass, taxpayers will miss out on the break.
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].