Infrastructure and Investment Jobs Act poised for Senate passage. The Senate is expected to pass the bipartisan $1 trillion infrastructure bill today. Will there be a cryptocurrency reporting deal? Yesterday, senators and the Biden Administration appeared to reach a compromise after the crypto industry opposed the original reporting requirements backed by the White House. But it remains unclear whether the Senate will get a chance to vote on an amendment reflecting the agreement.
Senate Democrats released their $3.5 trillion budget blueprint. The budget resolution would expand Medicaid and Medicare, increase spending on child care, education, and efforts to fight climate change, and would be offset by tax increases on corporations and households earning more than $400,000. It also calls for softening the current $10,000 cap on the state and local tax (SALT) deduction. However, specific tax changes are not in the budget plan and will be written by Finance committee. The Senate resolution would require the Finance panel to find about $1.75 trillion in tax increases and entitlement spending cuts. The House must still pass its own version of the budget bill, which sets top-line spending and revenue targets.
Heading for the fiscal cliff, again. Senate Democrats chose to exclude from the budget resolution any increase in the debt ceiling. Rather than voting to increase the government borrowing limit with no GOP support, Democrats say they’ll tack it on to the inevitable continuing resolution they’ll need to keep the government open after Sept. 30. Treasury Secretary Janet Yellen has urged Congress to act quickly. The government will run out of borrowing authority sometime in the Fall but it is not yet clear when.
Border carbon adjustment without carbon pricing? It makes little sense to TPC’s Thornton Matheson. She writes that the Fair, Affordable, Innovative and Resilient Transition and Competition (FAIR) Act, proposed by a group of Democratic senators, uses a flawed formula to calculate tariffs on iron, steel, aluminum, cement, fossil fuels, and goods composed of these materials. But it has a bigger problem: The US has no national carbon price, leaving it with a net average effective price that is both low and likely impossible to calculate. The sponsors intend to discourage companies from moving production of energy-intensive goods out of countries with high carbon prices to those with lower carbon prices. But it would impose tariffs on European countries with lower prices than the US.
Indiana tax revenues continue to exceed expectations. Indiana’s budget agency reports the state collected an additional $65.2 million in tax revenues in July, 5.1 percent more than officials projected in April. Most of the extra revenue comes from its 7 percent sales tax, where revenue for July was 4.8 percent above the state’s target.
Georgia’s tax collections increased, too. Net tax collections in July neared $2.16 billion, and gross tax revenue receipts totaled $2.92 billion. In July 2020, gross tax revenue totaled $2.73 billion. Gross sales and use tax collections totaled $1.35 billion in July, an increase of $216.5 million, or 19.1 percent, over July 2020.
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