Which accounts for rising tax receipts?
Personal income tax payments may soon break a record. wall street journal Report (paywall) on an increase in personal income tax payments, which Congressional Budget Office Projects will reach $2.6 trillion in the fiscal year ending September 30. Most of the growth comes from taxes on capital gains and pass-through business income. Still, says CBO director Philip Swagel, “There’s one part that’s unclear that we need more time to figure out… it’s a mystery. Getting strong revenue is probably a happy secret.”
As for corporate tax receipts… it’s economy, not TCJA. The spurt in corporate tax revenue in 2021 is due, some claimed, to a large tax cut in the Tax Cuts and Jobs Act of 2017. But TPC’s Bill Gale and Steve Rosenthal and the Tax Foundation’s Kyle Pomerleau argue that last year’s strong economic growthHigh inflation, and pandemic-related relief legislation increased both corporate profits and paid-tax business.
Slightly Better News for Social Security and Medicare Trust Funds, Social Security Trustees Reported The retirement program will remain solvent until 2034, which is one year more than the previous year’s estimate. Medicare trustees projected the Part A Hospital Insurance Trust Fund to go bankrupt in 2028, two years later than last year’s estimate. The modest improvement is due to higher payroll tax collections from a stronger-than-expected economic recovery.
Three House Democrats are pushing for a restricted SALT workaround. New York and New Jersey lawmakers told Treasury Secretary Janet Yellen and IRS Commissioner Charles Ratig that reverse the 2019 rule that blocks A solution to the federal $10,000 limit on state and local tax deductions. Connecticut, New Jersey and New York passed laws that allow local governments to create charitable funds to provide services. In return donors can deduct gifts to those charities on their federal income tax return and avoid state and local tax deduction limits.
On the hill this week. Senate Finance Committee holds a Tomorrow hearing on the budget of the President’s fiscal year 2023, On Thursday, the Senate Budget Committee held a Hearing on Social Security reform Solvency by increasing taxes on the rich.
This Wednesday with TPC: International Spillover in Tax Policy. Globalization links national tax issues with international tax policies. Tune in at 10:30 to hear keynote speaker Rosanne Altschuler discuss the roles played by home countries, host countries, and multinational corporations. Expert panels will follow, one examining the effects of a US corporate tax on the intellectual property space and the other discussing how a well-designed carbon tax can reduce production shifts in countries with low carbon prices. Register and watch here,
On June 16: 12th Annual IRS/TPC Joint Research Conference on Tax Administration. The virtual conference highlights researchers from the IRS, other government agencies, academia and private organizations who will present their latest analysis of ways to make tax administration as effective as possible. Learn more and register here,
In case you missed the TPC’s latest update on TaxVox… Arvind Boddupalli writes that’s a new Government Accountability Office (GAO) Report Demonstrates why better data is necessary for a more complete understanding of the effects of the tax system on racial inequalities. howard Glickman considers whether Congress Tax should be increased to fight inflation. And Tax Hound argues that absent Roe Vs Wade, tax law is Wrong place to decide whether a fetus is a baby,
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