Democrats push to roll back some business tax cuts in stimulus talks.
More than 100 Democratic lawmakers are urging repeal of California Speaker Nancy Pelosi and New York Senator Chuck Schumer, the majority leader. Business tax break As part of the economic aid package, which Democrats hope to send to President Biden in the coming weeks.
Legislation led by Texas Representative Lloyd Doggett and Senator Sheldon Whitehouse of Rhode Island say some businesses will be effectively taxed in the coming years – which could reduce federal borrowing for aid packages by $ 250 billion As much as.
Mr. Biden has proposed a $ 1.9 trillion plan, with all borrowings financed with money. Many Republicans have objected to the price tag, stating that it is overstating the economy and will push the federal deficit forward.
On Monday, 10 Senate Republicans coped with the $ 618 billion plan. But those Republican lawmakers would almost certainly reject any increase in trade taxes as a means of bridging the gap on both sides when they borrowed for the bill.
The tax cuts under consideration – which center on the so-called net operating deficit – were included in Congress, a rescue bill passed in March 2020, as the epidemic spread and the nation was in the midst of a recession. They were a temporary rollback of a limit placed on trade cuts by the 2017 tax law that Republicans passed and former President Donald J. Trump signed on. In fact, the March provision allowed some companies to apply those losses in recent years to the federal government to reduce their tax bills to compensate for taxes on profits from the previous five years.
Supporters of those tax breaks – including Congressional Republicans and business groups – said the move would give cash benefits to companies struggling in the midst of the epidemic.
In their letter to Ms. Pelosi and Mr. Schumer, Democratic lawmakers say the cuts “benefit high-income taxpayers, including hedge funds, real estate developers and prospects.” Trump family. “
“The best place to start is for Republicans,” Doug and Mr. Whitegate said in a written statement. Eliminating $ 250 billion bonus for hedge fund managers and real estate bookies. “With 120 Democratic lawmakers, we urge negotiators to wind up the least needy and reinvest the most needy.”
Lawmakers proposed repealing the change, which applies to losses from 2018 to 2020, and made the Trump-era threshold permanent when net operating losses were withdrawn.
Those changes together would increase federal revenue by an estimated $ 250 billion over a decade, lawmakers said, citing the Congressional Joint Committee on Taxation estimates. Some of that money will come from “clawing back” tax refunds sent by the government to companies that have already recorded their taxes and use the expanded damages provision.