The Coronavirus Relief Clock Continues to Count Down

Taxes

Headway in negotiations, with a nod toward a pared down stimulus bill. House Democrats trimmed their coronavirus relief bill from $3.4 trillion to $2.2 trillion this week, and may vote on it at the end of the week. Speaker Nancy Pelosi says talks with the White House have been “positive” and hopes to reach a deal with the White House before the House  vote. White House economic adviser Larry Kudlow said that $2.2 trillion remains “too big” a number. 

What’s in the revised bill? The House measure includes $436 billion in emergency aid for state and local governments; $225 billion for schools and child care; an additional round of $1,200 stimulus checks for most Americans; money to restore $600 expanded unemployment payments through January; as well as $25 billion to stave off thousands of layoffs at passenger airlines, $3 billion for airline contractors, and $120 billion for the restaurant industry.

Biden To Trump: My tax payment was (way) bigger than yours. To help keep alive the story of Trump’s paltry federal income tax payments, Joe Biden released his 2019 return yesterday. It showed that he and his wife paid $300,000 in federal income taxes on about $985,000 in income. Running mate Kamala Harris and her husband paid more than $1.1 million on nearly $3.3 million in income. The New York Times reported on Sunday that President Trump paid $750 in federal income taxes in 2016 and 2017, and paid no federal income taxes at all in 10 of the previous 15 years.

COVID-19 has turned our understanding of city finances upside down. TPC’s Tracy Gordon, Richard Auxier, and Aravind Boddupalli write that the pandemic and resulting recession could create a fundamental shift in local government finances. Already, revenue shortfalls and budget cuts are halting long-term infrastructure projects and forcing furloughs and layoffs. They also may require a re-examination of what is a financially successful city. They suggest the  funding model in many cities may be broken, forcing them to  closely examine their individual  revenue systems. One constant: Support from states and Congress is paramount to the fiscal health of cities.

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 dailydeduction@taxpolicycenter.org.

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