ABOUT THOSE CHOICES: A full extension of all the expiring portions of the Tax Cuts and Jobs Act would cost around $4.6 trillion over a decade under current projections, though even that might not give a full accounting of the price tag. Meanwhile, the Penn Wharton Budget Model estimated recently that the fiscal proposals from former President Donald Trump would raise deficits by close to $6 trillion over 10 years, primarily through his proposal to extend all the temporary TCJA provisions. (The budget group also has Trump down for seeking to further cut the corporate rate, from 21 percent to 15 percent, even as the former president and his team have floated a range of ideas on that front.) At the same time, Vice President Kamala Harris’ plans would heap a lot less on to the federal debt, according to PWBM — about $1.2 trillion over a decade. But that figure almost certainly doesn’t tell the full story, in no small part because Harris hasn’t fully fleshed out her policy platform since she took over as Democratic nominee. For instance, Harris hasn’t officially announced that she’d keep President Joe Biden’s pledge not to raise taxes on anyone making under $400,000 a year or that she’s embraced the full $5 trillion in tax increases that Biden had in his last budget, even though her campaign has said she is proposing to do both. Those are the kind of far-reaching plans that PWBM didn’t account for as the group, in its own words, sought to “analyze the policy ideas for which enough information is available.” (There’s more to come, too: Harris said during a recent campaign stop in Georgia that she would soon be proposing a new tax credit for startup small businesses, according to Bloomberg.) Looking ahead: No matter who wins in November, and which party ends up with control of the House and Senate, there are real questions about how much policymakers in both parties will be willing to add to the federal debt when dealing with the TCJA expiring provisions next year. Sen. JD Vance (R-Ohio), Trump’s running mate, suggested recently that a Trump-Vance administration would make cutting deficits a priority — but also that they don’t necessarily trust the independent scorekeepers that would project the cost of tax-cut extensions next year, as the Financial Times noted. Elsewhere, GOP leaders on the Hill have suggested that they would quickly move to fully extend the Trump tax cuts if Republicans sweep in November. But lobbyists and business advocates are also coming around to the idea that they might still have to be proactive to ensure that their preferred policies — like that current 21 percent corporate rate — aren’t used to help pay for the extension of other tax policies. Smith and other Republicans, for instance, have noted that there could be some interest within the GOP for increasing that corporate rate, though it’s not clear how much of that was meant as a wake-up to the business community that they need to be mindful of the fiscal concerns that could color next year’s negotiations. Deloitte, for instance, is out with a new report today that argues that “it is not too early” for interested parties to start examining all the various tax proposals that could play a role in next year’s debate, and to start taking action on getting their point-of-view out there. “If Congress decides to pay for some or all of the TCJA extensions, corporate revenue raisers — in the form of a rate increase, base-broadening provisions, or both — may well be up for discussion, even though some Republican lawmakers continue to believe as a matter of principle that extensions of current law need not be offset,” as the paper from the Big Four accounting firm put it. ICYMI: The Biden administration started the process for potentially challenging Canada’s digital tax on Friday, prompting cheers from the business communities on both sides of the border. Here’s one of the biggest takeaways from a Pro Trade collaboration out of both Washington and Ottawa — any resolution that comes via established trade dispute mechanisms would likely take at least a year. So it’s certainly possible that there will be uncertainty swirling around Canada’s digital tax for quite awhile. At the very least, it doesn’t look like the first pillar of the global tax deal — the part of the agreement meant to essentially eliminate digital taxes — will ride in to offer a solution anytime soon, given all the problems it’s facing. ABOUT THAT AMAZON PACKAGE TAX: A growing number of states are considering retail delivery fees to help pay for infrastructure, to help make up for diminishing returns from gas taxes. Washington state, the home of Amazon, is even looking into the idea, which already been put into place in Colorado and Minnesota. One of the big criticisms of online delivery taxes? That they end up hurting customers of more modest means. The Chamber of Progress, which bills itself as a center-left tech advocate, is out with a new report today that fleshes out that argument, with a focus on the delivery fees in Colorado. The group found that small businesses were also hurt by the idea, on top of the impact on lower-income households. “Although the state government was able to make a small dent in the budget gap, the unintended negative economic impacts are substantial — especially on economically disadvantaged populations and small businesses,” said the group’s report, conducted by NDP Analytics.
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