President Biden wants to expand eligibility for health care premium tax credits. Currently, the Affordable Care Act (ACA) caps health care premiums for individuals at 10 percent of their incomes, but the cap does not apply to spouses and children insured through family members’ employers. Biden would allow families to receive tax credits if their total coverage costs exceed 10 percent of their incomes. It would cover 200,000 more people and lower premiums for 1 million others. A Treasury official declined to specify how much the proposal would cost or how it would be paid for.
Poland vetoes the EU’s 15 percent global corporate minimum tax. Several other countries that resisted the idea, including Estonia, Hungary, Malta, and Sweden, withdrew their objections before yesterday’s meeting. But Poland still insists that a robust digital tax be explicitly tied to the minimum tax. EU tax initiatives require unanimous support of member nations.
Treasury suspends tax information-sharing agreement with Russia. In more fallout from the Russian invasion of Ukraine, Reuters reports the US Treasury has suspended the agreement, which helps Russia collect taxes. The US stopped sharing the information the day Russia invaded Ukraine but now has formalized the move, Reuters reports.
Maryland drivers won’t save much from the state’s gas tax holiday. TPC’s Robert McClelland illustrates why. The real, inflation-adjusted value of the combined federal and state gas taxes in Maryland is the same as it was in 2010 and substantially below 1993. A Maryland driver who uses 20 gallons of gas weekly would save only about $30 over the state’s month-long holiday—if the entire tax cut is passed on to consumers.
Virginia Gov. Youngkin sends a gas tax holiday plan to the legislature. Following their neighbor Maryland, Virginians could soon see a gas tax holiday. Youngkin’s plan—which he says requires immediate action by the General Assembly—would suspend the state’s 26.2-cent gasoline tax through July and then phase it back by September. Minor roadblock: Youngkin sent the bill to the General Assembly after its special session went into recess.
Georgia passes a $1 billion tax cut. Late Monday night, the Georgia Senate and House agreed to create a flat income tax of 4.99 percent by 2029 or later. It would cut taxes by over $1 billion. Gov. Brian Kemp will sign the legislation this week. There is no formal revenue estimate, but the Senate Finance committee says the plan would cost $455 million in its first year and over $1.2 billion when fully enacted.
Minnesota lawmakers prepare tax relief bills without Gov. Walz’s plan for rebates. Senate Republicans plan to use $8.3 billion over three years to make permanent cuts to income taxes and exempt Social Security income from state taxes. House Democrats have a smaller tax relief package that includes a $325 rebate to parents, expansion of the dependent care tax credit, and a bigger tax credit for student loan payments. Neither chamber supports Walz’s proposed $500 rebate for each Minnesota adult. Republicans call it a gimmick, while Democrats say there are more efficient ways to use the budget surplus.
The second phase of the Pilot IRS Solution Challenge is now underway. A robotic intelligent digitization company, Ripcord, working with the Enterprise Digitalization and Case Management Office of the IRS, has been helping the IRS reduce manual processes and reliance on paper. In a six-month initiative, a pilot program will digitize Form 709 that reports transfers of assets that might be subject to federal gift tax.
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