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. NICE TAX TREATY YOU GOT THERE: If nothing else, this wasn't subtle — the Biden administration is ending its tax treaty with Hungary because of Budapest's efforts to block implementation of the global tax deal, as Pro Tax's Brian Faler noted. To be fair, the Treasury Department said the tax treaty, which went into effect more than 40 years ago wasn't working for the U.S. anyway. Hungary's corporate tax rate is now down to 9 percent, which is one big reason Prime Minister Viktor Orbán's government is blocking the EU from moving forward on a global minimum tax of 15 percent for big multinational corporations. If Hungary went along with the minimum tax, the current treaty would be a better deal for the U.S., Treasury said. What's not clear is how much Treasury's hard line on the treaty will affect matters in Budapest, where the Orbán government has shown no signs that it's softening in its opposition to moving forward on Pillar Two of the tax deal negotiated through the Organization for Economic Cooperation and Development. Either way, there's a couple ways to look at Treasury's decision on the Hungary tax treaty. On the one hand, it maybe shouldn't be too big of a surprise that Hungary invited some backlash by being the sole member of the 27-country EU to block implementation of the minimum tax — and took that stance as Poland, another part of the bloc, was backing away from its opposition. But on the other hand, people close to the business community say it's a bad idea for the U.S. to be seen as undependable on its treaty obligations. ON SECOND THOUGHT: It was a pretty understandable thought, and for a lot of people — how could it be completely chance that both James Comey and Andrew McCabe were both picked for an invasive and rare IRS audit, just a couple years apart? After all, former President Donald Trump made it clear many times that he wasn't fond of either the former FBI director or his deputy. But in the days since The New York Times broke the story about those audits, more and more experts are talking about just how hard it would be to fix the National Research Program audit process to single out Comey and McCabe. Tax Notes' Jonathan Curry talked to several former IRS higher-ups and people who have long worked closely with the agency, and they all basically said it was plausible that Comey and McCabe were simply chosen by the program's automated process — as hard as that might be to believe. And while the odds would surely be long for both Comey and McCabe to be chosen, The Washington Post's Jacob Bogage and Josh Dawsey noted that they would've gotten shorter after the two were no longer employed by the federal government. That's because Comey and McCabe's tax situations would have been less straightforward and of more interest to the IRS, with the two getting income from things like book deals, cable news contracts and paid speeches. A couple more quick points: Mark Mazur of the Urban-Brookings Tax Policy Center, a former top Treasury and IRS official, told Tax Notes that it shouldn't be that difficult for Treasury's inspector general for tax administration to get to the bottom of this issue. (Keep in mind that there's been an investigation for some 13 months now on how ProPublica obtained private taxpayer information.) And an interesting policy question here: Should IRS officials have saved Comey and McCabe from undergoing the audits if they were chosen through regular channels, because of the potential political ramifications? Former IRS chief Mark Everson told The Washington Post yes last week, while the former national taxpayer advocate Nina Olson believes it would've been unfair to substitute in less prominent taxpayers for reasons outside their control, according to Tax Notes.
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