Lower Tax Receipts May Hasten Debt Limit Breach
Will the country reach its debt ceiling soon? Analysts are predicting as much, since tax collections are so far weaker than expected. The Wall Street Journal reports (paywall) that the Treasury General Account rose to $265 billion as last week, one of the lowest levels since 2021. On top of that, Yardeni Research analysts note that federal outlays have been rising again in recent months. Combined, this would bring “the debt ceiling crisis to a head sooner in June,” according to Yardeni Research.
Gov. Kelly: No tax cuts in Kansas. Democratic Gov. Laura Kelly vetoed a $1.4 billion tax cut bill this week passed by the GOP-led legislature. The three-year package would have imposed a single, flat income tax rate on individual income. Kelly said replacing the state’s current three-rate tax structure would have been fiscally “reckless” and threatened public school funding. The legislature reconvenes tomorrow and may have enough votes to override the veto.
A flat tax plan hits a wall in Wisconsin. Republican lawmakers introduced a bill to lower Wisconsin’s top three tax brackets to 4.5 percent, but Assembly Speaker Robin Vos said the proposal is not the official Republican plan, as the lawmakers did not bring it to the GOP caucus for approval. The plan might get a vote in the Joint Finance Committee next month before the panel finishes work on the state budget.
Are tax benefits helping raise tuition in some religious schools in Iowa? A new law in Iowa allows students to enroll in private schools and use state tax dollars to cover expenses. But a variety of Catholic schools are increasing their tuition by as much as 30 to 40 percent. One religious school says they’ll use Iowa’s Educational Savings Account dollars to pay staff higher wages and improve programming.
IRS seeks membership nominations for the 2024 Internal Revenue Service Advisory Council. The agency is accepting applications for the 2024 Internal Revenue Service Advisory Council. Applications are accepted through May 31, 2023. The IRSAC serves as an advisory body to the IRS commissioner and provides an organized public forum for discussion of relevant tax administration issues between IRS officials and representatives of the public.
For the latest tax news, subscribe to the Tax Policy Center’s Daily Deduction. Sign up here to have it delivered to your inbox weekdays at 8:00 am (Mondays only when Congress is in recess). We welcome tips on new research or other news. Email Renu Zaretsky at [email protected].
