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The TCJA encouraged foreign-owned companies to retain more US earnings. a New TPC Study shows that corporate tax cuts in the Tax Cuts and Jobs Act (TCJA) encouraged foreign-owned US companies to reinvest more of their earnings here. The researchers also found a positive correlation between the TCJA tax deduction and foreign-owned companies’ investments in US tangible assets. It is unclear whether the TCJA tax cut will result in a higher overall foreign investment in the US, although the significant impacts of the pandemic will make it difficult to know.
GAO: IRS audit rates keep falling, government accountability office found Audit rates for personal income tax returns fell from 0.9 percent in 2010 to 0.25 percent in 2019. Audit rates fell for all income levels, but the biggest drop was for those with incomes of $5 million or more. Those higher-income households were still audited at higher rates than lower-income filers. The IRS attributed the decline to budget cuts. The audit rates for tax year 2020 are likely to be even lower.
Solving a budget mystery. TPC’s Howard Glickman asks why Congress is set to increase aid to Ukraine to $40 billion without any offset, but may push for spending cuts to offset $10 billion in new funds for COVID-19 therapeutics, vaccines and tests. The answer has nothing to do with the actual concern about losses. Instead, lawmakers use the argument for payment to slow or kill a new expense they don’t like.
California manufacturers want the state to suspend sales taxes on purchases of new equipment. The California Manufacturers and Technology Association says: do On appliances—up to 10.75 percent in some cases—the industry is fond of. Industry leaders are expected to get a tax holiday during budget talks this spring.
Colorado property tax rates will decrease. Governor Jared Polis signed the bills this week reduce property tax rates For home owners. The reduction in commercial property tax rates will be the first in 40 years.
South Carolina veterans are now exempt from state income tax on military retirement benefits. Governor Henry McMaster signed a bill last week that Military Retirement Income Exemption from income tax. Previously, veterans get a partial tax exemption if they serve at least 20 years. top rate on personal revenue is 7 percent.
Portugal will soon impose taxes on cryptocurrency gains. The country’s finance minister said cryptocurrency will soon be subject to taxation, Cryptocurrency profits are currently tax-free and Portugal is considered a tax haven for these investors. The current capital gains tax rate on most financial gains is 28 percent.
For the latest tax news, subscribe to the Tax Policy Center’s Daily Deductions. Sign up Here To have it delivered to your inbox at 8:00 a.m. on weekdays (only on Mondays when Congress is in recess). We welcome suggestions on new research or other news. Email Renu Zeretsky here Dailydeduction@taxpolicycenter.org,
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