Posts Tagged ‘tax cuts and jobs act’
Myths of the 2017 Federal Tax Act
The “Tax Cuts and Jobs Act” (TCJA)—the massive federal tax cut passed in December 2017—has failed to produce the benefits touted by its promoters. And if history is any indicator, there is no reason to believe things will change in the future. The following debunks several often-touted claims made by TCJA backers. Myth #1: The…
Read MoreTax Conformity Impasse Was Only Partially About Conformity
In the recently concluded legislative session, lawmakers failed to agree on how to conform Minnesota’s tax code to the new federal tax law passed late last year. The Governor and conservative leadership agreed on most of the mechanics of federal tax conformity, with some significant exceptions. Where they did not agree was on how to…
Read MoreIn the Long Run, Vetoed Tax Bill Would Have Ladled Out More Corporate Tax Breaks
On May 23, the Governor vetoed House File (HF) 947, the tax and education bill passed by the Minnesota House and Senate on the last day of the 2018 legislative session. Its conservative authors argued that it will increase corporate taxes relative to current law. A deeper dive into the available information reveals that the…
Read MoreHouse & Senate Tax Bill Prioritized Corporations over Working Families
It’s been a whirlwind week on the Minnesota tax policy front. On Tuesday, the House and Senate Conference Committee approved a tax bill. The bill went quickly to the House floor, where it passed the same day. On Wednesday, the Senate approved the same bill. And on Thursday, Governor Dayton vetoed it, citing among other…
Read MoreThe Federal Tax Act’s Minnesota Impact: Steeply Regressive
Corporate elites and wealthy Americans celebrated when Congressional conservatives and President Trump rolled out the so-called “Tax Cuts and Jobs Act” (TCJA) late last year—and with good reason. The TCJA was overwhelmingly regressive, sending a disproportionate share of tax relief to high-income households that have benefited from rising income inequality for decades. Analysis confirms this…
Read MoreGenerating State Revenue Through Corporate Tax Conformity
The so-called “Tax Cut and Jobs Act” (TCJA) enacted by Congress last year made massive changes to the federal tax code. Minnesota and other states must now decide if and how to conform their own tax codes to the federal changes. As we note in part 1 of this series, the qualified pass-through income tax…
Read MoreFederal Tax Act Pass-Through Provision: What a Mess!
Tax laws should be simple and direct. Taxpayers should be able to understand and comply with them without the assistance of an army of attorneys and accountants. The treatment of pass-through income in the new federal tax law passed late last year—the so-called “Tax Cut and Jobs Act” (TCJA)—fails miserably by this standard. Specifically, the…
Read MoreEnjoy Your Penny While You Can, Homer Simpson
A recent blog post from the Center for the American Experiment (CAE)—Minnesota’s right wing think tank—features an overjoyed Homer Simpson. Homer apparently celebrates the “bonuses and pay hikes” that Minnesota workers are supposedly receiving through recent federal tax cuts. Only Homer—a slow-witted sap that can be duped into any harebrained scheme by a bag of…
Read More