Want to receive this newsletter every weekday? Subscribe to POLITICO Pro. You’ll also receive daily policy news and other intelligence you need to act on the day’s biggest stories. LOOKING FURTHER AHEAD: Democrats continue to believe their 2021 expansion of the CTC into a monthly payment program still has some political potency, as the vice president’s comments last week show. And as it happens, Harris’ 2020 presidential campaign — when she essentially proposed a souped-up version of the Earned Income Tax Credit — also suggests she would be interested in using the tax code as president to deliver benefits to families, as Brian also noted. If Harris did defeat Trump in November, she would also become central to the upcoming debate over how to handle a collection of provisions from the GOP’s 2017 tax law that expire at the end of next year. That would be a potential opportunity for Democrats to pound the table once more for a further expansion of the Child Tax Credit. Note, for instance, that Sen. Michael Bennet (D-Colo.) — who also ran for president in 2020 and has been a longtime champion for the monthly child allowance — cited Harris’ support for expanding the CTC in the second sentence of his endorsement of the vice president. Meanwhile, the official GOP platform for 2024, and most GOP officeholders, are calling for a full extension of the Tax Cuts and Jobs Act — which itself included a doubling of the CTC, from a maximum of $1,000 to $2,000 per eligible child per year. The rest of the book on Harris and taxes: The current vice president’s 2020 campaign sputtered so severely that it actually finished in 2019. But it’s worth noting that she didn’t get behind the kind of plan that dominated the Democrats’ debate on taxes during that primary campaign — the wealth tax sought by Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.). Harris did propose a financial transactions tax, another idea that has a lot of support among progressives, during that campaign. Still, campaign tax plans are known to be highly aspirational, and it would be a surprise if Democrats’ wish list for revenue-raisers in 2025 — currently centered on ideas like raising the 21 percent corporate rate — change much even with the upcoming shift atop the ticket. WELCOME BACK, CONGRESS: Speaking of things getting overshadowed — the Senate is expected to start consideration of Biden’s Tax Court nominees in the coming days, as we noted last week. What’s less clear is whether Senate Majority Leader Chuck Schumer brings the bipartisan tax bill negotiated by Senate Finance Chair Ron Wyden (D-Ore.) and House Ways and Means Chair Jason Smith (R-Mo.) up for a vote before the upcoming August recess. The end result would likely be the same, either way — the bill that includes a more modest expansion of the CTC and a revival of key business tax breaks probably wouldn’t pass if it does reach the floor due to GOP opposition. Among other things, that measure also would end the Employee Retention Credit, the pandemic-era relief program for businesses that became a magnet for questionable claims, retroactive to January — or more than a year before its current finish date. With the program likely to stick around, the IRS has started getting more nudging from the Hill on getting more ERC dollars out the door, after the agency installed a moratorium on new claims in September. Erin Collins, the national taxpayer advocate, has also suggested that the IRS has become too cautious in approving ERC claims, at the expense of businesses in need. And just last week, former IRS chief Chuck Rettig explicitly made that argument as well in an opinion piece for Fortune. The IRS has suggested that between 150,000 and 300,000 of the claims currently caught in a backlog are lower-risk, and Rettig wrote last week that the agency should move quickly to pay those out. So stay tuned to see if there is much more of a pressure campaign here: “Instead of issuing mass denial letters to bad applicants, the service should be getting the good claims out the door and fulfilling the ERC’s design of helping small businesses in need,” said Ryan Taylor, a spokesperson for the Coalition to Preserve American Jobs, a group organized specifically to lobby on this issue.
| 
Comments
Post a Comment