Trading business tax breaks for a smaller expansion of the Child Tax Credit. Senate Finance Committee Chair Ron Widen says Democrats could scale back their proposal to nearly double the current $2,000-per-child credit as part of a deal to restore business tax breaks sought by Republicans, including bonus depreciation, the deduction for interest expenses, and expensing of research costs.
How might the US meet climate goals of the Paris Agreement? The Inflation Reduction Act could help the US reduce 2005 carbon emissions by 40 percent by 2030. But TPC’s Thornton Matheson recommends the US reach the agreement’s 50 percent goal with a federal carbon tax that returns revenue to low-income households. The tax could super-charge existing green energy credits by widening the price gap between clean and dirty energy sources. It also could reduce US trade risks from future EU and Canadian border carbon adjustments (BCAs).
Changing of the Guard. With Republicans taking control of the House next year, Speaker Nancy Pelosi and Democratic Whip Steny Hoyer are stepping down from their leadership posts. The moves open the door to a new generation of leaders. Rep. Hakeem Jeffries of New York is the front-runner to replace Pelosi when members vote in a couple of weeks.
Beware the debt limit. In an interview with TPC’s webcast The Prescription, former top House GOP tax aide George Callas warned Wall Street against being too confident that Congress will reach a deal next year to extend the nation’s borrowing authority before the debt limit is breached.
Weisselberg: Trump Organization moved to end off-the-books payments after Trump became US President. In the company’s criminal tax fraud trial, former CFO Allen Weisselberg testified, “We were going through an entire clean up process to make sure that since Mr. Trump was now president, that everything was done properly.” Weisselberg testified that other top executives were aware of the tax fraud, but insisted no member of the Trump family was involved.
Utah lawmakers would cut income taxes, limit property taxes. The state has a $1.3 billion surplus and the legislature’s tax writing committee has approved a measure to cut the income tax rate from 4.85 percent to 4.8 percent. Legislative leaders may propose a deeper cut. The committee also moved to tighten the state’s property tax. Currently 45 percent of property values are tax-exempt, but the amendment would make 45 percent the minimum share of personal property that is not taxed. The proposal also would permanently ban real estate transaction taxes.
UK government announces tax increases and spending cuts. Facing a slowing economy and high inflation, the Conservative government proposed a £55 billion ($66 billion) plan to cut spending by £30 billion raise taxes by £25 billion. The plan, a dramatic reversal of former Primate Minister Liz Truss’s tax-cutting mini-budget, would freeze income tax thresholds for two more years and lower the top income tax bracket to £125,140. It also raises by 10 percent state pensions, benefits, and tax credits. The government also would expand the UK’s tax on windfall profits earned by oil and gas companies, raising £14 billion by increasing the tax to 35 percent and extending it for two years.
India raised its windfall tax on crude oil. The government increased the tax by $9 to $125.22 per metric ton. It has also cut the export tax on diesel by 19 percent, to 12.8 cents per liter.
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