GOP House tax plan will be released this week
The House will release a tax plan on Wednesday that would cut the top individual tax rate to 25 percent. Read on for the GOP's tax proposal and and teh rest of today's tax news.
Senate Finance Committee Chairman Sen. Max Baucus, D-Mont., left, and the House Ways and Means Committee Chairman, Rep. Dave Camp, R-Mich., talk about tax reform to 3M employees at the 3M Innovation Center in Maplewood, Minn. last year. Camp will present a tax plan Wednesday, Feb. 26, 2014 that would cut the top individual tax rate to 25 percent.
Hannah Foslien/AP/File
Here’s The Daily Deduction, the Tax Policy Center summary of the day’s tax news. We’ll let you know about upcoming action in Congress, the Administration, and in the states and keep you up-to-date on the latest tax policy research. You can find The Daily Deduction on TPC’s blog TaxVox or in the What’s New section of the TPC homepage. We’ll also be distributing The Daily Deduction every morning by email to those who prefer to receive it that way. For the next few weeks, everyone on our email list will get The Daily Deduction. But to continue to receive it after March 15, please sign-up here. If you’d like to tell us about a new research paper or have any comments about our new feature, just drop us an email at dailydeduction@taxpolicycenter.org. We’d love to hear from you.
The House GOP offers its opening gambit in tax reform. The plan, due to be released on Wednesday by House Ways & Means Committee Chair Dave Camp, would cut the top individual tax rate to 25 percent. However, it would also impose a 10 percent surtax on high-income households, The Washington Post reports.
The IRS is taking its lumps. the House Oversight Committee has scheduled a hearing Thursday on proposed new IRS guidelines on political activity by 501(c)(4) non-profits. At the same time, Camp has warned the IRS that his panel might subpoena agency documents on its past handling of nonprofits’ tax-exempt status applications. Meanwhile, the IRS soldiers on, reporting that it has issued more income tax refunds so far this year than last. And yesterday it released a report on Criminal Investigation that highlights increased enforcement against tax criminals and more convictions for identify theft.
Today the Senate Budget Committee holds a hearing on the “Economic and Budget Outlook for Individuals, Families, and Communities” following CBO’s budget outlook released earlier this month. As you consider the budget, it’s worth remembering that individual income taxes may generate half of all federal tax revenue within a decade, comprising nearly all the projected rise in revenues.
New Jersey may see a huge battle over taxes and state employee pensions this year. Governor Chris Christie is about to release a budget that may include broad tax cuts and reductions in public pensions. What do these retirement changes mean for a state’s ability to attract and keep good workers? Rich Johnson, Gene Steuerle, and Caleb Quakenbush explore that issue with New Jersey as a case study in this Urban Institute paper.
Speaking of pension reforms, what if citizens could ‘see’ the financial health of public pensions? A new Blue Ribbon Panel report from the Society of Actuaries recommends more transparency. Its proposed liability measurement “would provide new insight into the market risks for pension plans and the shortfall that might have to be made up by local taxpayers if investment returns did not measure up to expectations.”