Wisconsin’s Paul Ryan will be House Ways & Means Chair for a while after all. The 2012 GOP Vice-Presidential nominee feels he is “in a position to make a big difference” and wants to remain on the tax-writing panel. Had he run for president in 2016, he would have had to give up his chairmanship—and his plans for broad tax reform, including corporate and individual tax rate cuts. His first hearing as chair is today, and will feature Harvard’s Martin Feldstein, Doug Holtz-Eakin of the American Action Forum, and MIT’s Simon Johnson.
Maryland’s Chris Van Hollen wants to use the tax code to reduce income inequality. It’s likely a futile effort given GOP control of Congress, but the House Budget Committee’s top Democrat has a plan to raise $1.2 trillion over a decade for middle class tax relief. He’d charge a 0.1 percent fee on stock trades and limit billions of dollars in tax breaks for the top one percent of earners. The money would cover the cost of cutting annual tax bills by $2,000 for couples earning under $200,000. Tax cuts would include a savings incentive, a near tripling of the child care tax credit, and a reduction of marriage penalties for two-earner couples.
Hill Republicans will keep the Joint Committee on Taxation’s chief of staff. Thomas Barthold has held the position since 2009, and is the longest serving chief of staff of the committee since 1977. He will be responsible for implementing the House Republicans’ new rule for dynamic scoring of tax legislation, designed to account for changes in the national economy when estimating a bill’s fiscal impact.
Investment banker Anthony Weiss has withdrawn from Treasury under-secretary consideration. He ran into opposition from Senate Democrats given his ties to corporate inversion deals. Instead, he will become counselor to Treasury Secretary Jack Lew—a position that doesn’t require Senate confirmation.
New York City Mayor Bill de Blasio wants to cut taxes for manufacturers and small businesses. His proposed $300 million in rate cuts also aim to simplify filing since they are designed to be consistent with state business tax rates. De Blasio would offset the cost by eliminating some business deductions and credits. New York State needs to approve the plan.
With tax prep software, it pays to be transparent. Purchasers of the 2014 version of Intuit’s Turbo Tax Deluxe were surprised to learn that forms for self-employment income and capital gains are missing—a change from past editions. To get software to help do the paperwork, purchasers must upgrade—for an extra $30. Many customers are furious and expressing their displeasure online. Competing tax prep firm H&R Block sees a marketing opportunity and is offering a free copy of its product to those who bought the stripped-down TurboTax version. It will be interesting to see how Intuit responds.
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