Tax Refund

House Budget Committee holds a hearing on the “fiscal state of the union.” The House Budget Committee heard thoughts from leading public finance experts yesterday on the federal government’s fiscal conditions. While the national debt was a major focus, the impending debt limit breach also got a mention. During the hearing, Mark Zandi of Moody’s Analytics estimated that default could occur by mid-August. Rep. Scott Peters (D-CA) said that a clean debt ceiling hike — which is what President Biden wants — doesn’t seem likely.

A Senate Finance report accuses Credit Suisse of withholding information owed to the government as part of a 2014 tax evasion case. Via the Wall Street Journal, Democratic staff of the Senate Finance Committee argue that the bank helped American accountholders hide information from US tax authorities, despite pledging to cease the activity after a 2014 plea deal. “The Committee’s findings reinforce the need for additional IRS resources to combat tax evasion by ultra-high net worth individuals,” the report says. “The staggering decline in enforcement personnel at the IRS has emboldened millionaire tax cheats to conceal enormous sums of wealth through the use of secret foreign bank accounts.”

Congressional Republicans signal a willingness to search for a compromise on the $10,000 cap on state and local tax (SALT) deductions. Enacted in 2017 to help pay for the cuts in the Tax Cuts and Jobs Act, the SALT cap has long been a target of Democratic lawmakers representing high-tax jurisdictions. Now, some New York-based Republicans are looking for a deal, according to Bloomberg Tax. The story notes that repealing the cap would encounter resistance, but a more modest proposal — including repealing the “marriage penalty” and doubling the cap amount to $20,000 for joint filers — could garner some Republican support.

New York City dishes out $277 million a year in property tax breaks to four professional sports franchises. The estimate of the tax subsidies for the Knicks, Mets, Yankees, and Nets comes from a new analysis by the city’s Independent Budget Office. Compiled at the request of state Sen. Brad Hoylan-Sigal (D), the report also explores the different array of incentives provided to each stadium. Field of Schemes, a site critical of the perceived economic benefits of subsidizing professional sports, noted that the estimated foregone property tax revenues are on top of $1.1 billion in incentives for the Yankees and Mets.

Delaware lawmakers send a marijuana legalization bill to the governor’s desk. The Delaware Senate approved the bill 16 to 4 on Tuesday, following passage by the House earlier this month. The proposal — which would legalize small amounts for personal use and create a regulatory structure for growing and distributing cannabis — now goes to Gov. John Carney (D) for approval. Carney last year vetoed legislation that only addressed the legality of possession of the drug. Rep. Ed Osienski (D), the lead sponsor, told Delaware Public Media that supporters are “optimistic” that ongoing negotiations with Carney will prevent a veto.

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