On The Hill

Congress

CR

On Tuesday (Sep. 22), the House voted 359-57 to pass a Continuing Resolution (CR) to fund the government until Dec. 11, 2020.

“We have an agreement that will keep the government functioning for the people,” House Majority Leader Steny Hoyer (D-MD) said on Tuesday (Sep. 22).

On Thursday (Sep. 24), the Senate had a procedural vote on the CR and Senate Appropriations Chairman Richard Shelby (R-AL) said a final vote on the CR will occur Tuesday (Sep. 29).

COVID-19 Stimulus

On Thursday (Sep. 24), House Speaker Nancy Pelosi (D-CA) indicated Democrats will draft a new COVID-19 relief bill and bring it to a vote before Oct. 2, 2020. House Ways and Means Committee Chairman Richard Neal (D-MA) estimated the new package will be in the range of $2.2 trillion.

The new legislation comes as Treasury Secretary Steven Mnuchin and Pelosi have agreed to restart talks about a second stimulus bill.

 

SCOTUS

On Friday (Sep. 18), Supreme Court Justice Ruth Bader Ginsburg passed away at the age of 87. Ginsburg was known as a champion of gender equality, civil liberties, and pay equity.

President Trump announced that he will nominate a replacement on Saturday (Sep. 26). On Friday (Sep. 25), Republican sources said President Trump intends to to select Amy Coney Barrett, a 48-year-old judge on Chicago’s 7th U.S. Circuit Court of Appeals.

Senate Majority Leader Mitch McConnell (R-KY) said he will hold a vote for the nominee and appears to have the votes needed for a confirmation to go through. Senators Lisa Murkowski (R-AK) and Susan Collins (R-ME) are the only GOP senators to oppose immediately filling Ginsburg’s seat.

 

New Ways and Means Subcommittee Chair

On Tuesday (Sep. 22), Rep. Bill Pascrell (D-NJ) was selected to be chair of the House Ways and Means Oversight Subcommittee. The position was previously held by the late Rep. John Lewis. Pascrell’s selection will last at least through the current Congress.^[1] 

 

OECD

On Tuesday (Sep. 22), Director of the Organization for Economic Cooperation and Development’s (OECD) Center for Tax Policy Pascal Saint Amans said the U.S. will likely ask for its own minimum taxation rules to be deemed compliant with a proposed OECD global minimum tax rate. Saint Amans said the U.S. request will occur because the OECD tax has been influenced by the U.S. global intangible low-taxed income (GILTI) rules. Whether GILTI is deemed compliant is a major concern for U.S. companies. The OECD said it will hold a public consultation on its blueprint reports on Oct. 12.^[2] 

 

Treasury

On Wednesday (Sep. 23), a Treasury Department spokesperson released a statement that said Treasury does not expect President Trump’s payroll tax deferral to impact Social Security Trust Funds because the deferral is temporary and must be repaid. The spokesperson went on to say that the deferral will have no impact on current or future payments received by Social Security recipients and the Trump administration remains committed to the integrity of the Social Security Trust Funds.^[3] 

To view the statement, click here.

 

Regulations

On Monday (Sep. 21), the Internal Revenue Service (IRS) and Treasury Department released the last set of final regulations on the immediate write-off of business investments. The regulations clarify requirements for property that must be satisfied to qualify for 100 percent immediate expensing. The provision was included in the 2017 Tax Cuts and Jobs Act (TCJA) and full expensing is scheduled to phase out beginning in 2023. Some proponents are pushing to have the tax benefit be made permanent.

To view the final regulations, click here.

 

CBO

On Monday (Sep. 21), Congressional Budget Office (CBO) Director Phillip Swagel said “federal debt will soar to levels unseen in the nation’s history over the next 30 years.”

CBO released its long term budget forecast Monday (Sep. 21) that predicted debt will rise to 98 percent of GDP by the end of 2020 and reach 195 percent of GDP by 2050. Swagel noted that the debt is manageable and Congress still has time to address it. However, action may soon be needed to secure Social Security, Medicare and highway trust funds.^[4] 

To view the budget forecast, click here.

 

EU-Apple Ruling

On Friday (Sep. 25), the European Commission announced it would appeal a court ruling involving Apple and Ireland. In July 2020, the European Union’s general court ruled that the Commission failed to prove the Irish government had given a tax advantage to Apple.

“We will review the Commission’s appeal when we receive it, however it will not alter the factual conclusions of the General Court, which prove that we have always abided by the law in Ireland, as we do everywhere we operate,” a spokesperson for Apple said on Friday (Sep. 25).^[5] 

 

Hearing Coverage

House Financial Services Committee

On Tuesday (Sep. 22), the House Financial Services Committee held a hearing entitled, “Oversight of the Treasury Department’s and Federal Reserve’s Pandemic Response.” The committee heard testimony from Treasury Secretary Steve Mnuchin and Chair of the Federal Reserve Jerome Powell.

To view a summary of the hearing, click here.

House Ways and Means

On Friday (Sep. 25), the House Ways and Means Subcommittee on Select Revenue Measures held a hearing entitled, “Restaurants in America During the Covid-19 Pandemic.”

To view a summary of the hearing, click here.

House Small Business Committee

On Thursday (Sep. 24), the House Small Business Subcommittee on Innovation and Workforce Development held a hearing entitled, “Paycheck Protection Program: An Examination of Loan Forgiveness, SBA Legacy Systems, and Inaccurate Data.”

To view a summary of the hearing, click here.

On Friday (Sep. 25), the House Small Business Subcommittee on Economic Growth, Tax, and Capital Access held a hearing entitled, “A Review of PPP Loan Forgiveness.”

To view a summary of the hearing, click here.

 

References  

^[1] Lorenzo, Aaron. “Pascrell named next leader of Ways and Means Oversight Subcommittee.” Politico Pro, 22 Sep. 2020 https://link.edgepilot.com/s/6937921b/cuq4xKYa5U2SLcf1fOTmYQ?u=https://subscriber.politicopro.com/article/2020/09/pascrell-named-next-leader-of-ways-and-means-oversight-subcommittee-3984091

^[2] Ali, Hamza. “OECD Expects U.S. to Ask for GILTI Exclusion From Minimum Tax.” Bloomberg Tax, 22 Sep. 2020. https://link.edgepilot.com/s/43a44bc8/wlbUF8HN30CHSJJOi88EYQ?u=https://news.bloombergtax.com/daily-tax-report/oecd-expects-u-s-to-ask-for-gilti-exclusion-from-minimum-tax?context=search%26index=29

^[3] Jagoda, Naomi. “Treasury: Trump’s payroll tax deferral won’t hurt Social Security.” The Hill, 23 Sep. 2020. https://link.edgepilot.com/s/a4aaf566/VWv_EflW8kGkgegfEUEuFQ?u=https://thehill.com/policy/finance/517879-treasury-trumps-payroll-tax-deferral-wont-hurt-social-security

^[4] Emma, Caitlin. “CBO warns federal debt will nearly double GDP by 2050.” Politico Pro, 21 Sep. 2020. https://link.edgepilot.com/s/75ccfbfd/LmYPpX590kGVKMbYMlWuXQ?u=https://subscriber.politicopro.com/article/2020/09/cbo-warns-federal-debt-will-nearly-double-gdp-by-2050-1998216

^[5] Amaro, Silvia. “EU appeals against Apple ruling in $15 billion tax battle.” CNBC, 25 Sep. 2020. https://link.edgepilot.com/s/555d0189/1BvRaXnE6kO0i6bHDWx1HA?u=https://www.cnbc.com/2020/09/25/eu-appeals-against-apple-ruling-in-15-billion-tax-battle.html