October 15, 2020
What to expect in Washington (October 15)
Regarding a potential bipartisan deal on coronavirus relief/stimulus, Treasury Secretary Steven Mnuchin said on CNBC this morning (Thursday) he will give ground to House Speaker Nancy Pelosi (D-CA) on the issue of coronavirus testing, which has been consistently cited as an area of conflict in negotiations that are now running short on time if a pre-election agreement is to be reached. "When I speak to Pelosi today, I'm going to tell her that we're not going to let the testing issue stand in the way. We'll fundamentally agree with their testing language subject to some minor issues. This issue is being overblown," Secretary Mnuchin said.
After the pair spoke October 14, a spokesman for the Speaker tweeted in part, "In response to proposals sent over the weekend, the two spent time seeking clarification on language, which was productive. … One major area of disagreement continues to be that the White House lacks an understanding of the need for a national strategic testing plan."
Secretary Mnuchin had sounded a note of pessimism October 14, saying at the Milken Institute Global Conference, "At this point, getting something done before the election and executing on that will be difficult," but that the two sides nonetheless continue to "make progress," Politico reported.
President Trump said on Fox Business this morning that he would be willing to agree to a larger dollar figure than the Administration's latest $1.8 trillion offer.
White House economic adviser Larry Kudlow said on CNBC October 14 that Secretary Mnuchin was "frustrated" with the negotiations, but, "Right now, you have a moment where I think you could come together in a sensible, targeted, efficient, smart package," and, "I'm not sure it's over, by the way."
House and Senate efforts on partisan bills have staked out each side's position on relief/stimulus ahead of the election but haven't helped compel a deal. The Senate could vote next week on a narrow GOP bill, and the Joint Committee on Taxation staff yesterday released an estimate of revenue provisions in a revised Democratic HEROES Act passed by the House October 1.
President Trump October 14 described, in a virtual address to economic clubs, what's at stake in the election in the starkest terms. "If the left gains power, the recovery will be terminated, and the economy will be destroyed," he said.
In a New York Times/Siena poll of North Carolina released October 14, Democratic presidential nominee and former Vice President Joe Biden leads President Trump 46%-42% among likely voters. (President Trump won the state in 2016 by more than three percentage points.) Democrat Cal Cunningham leads Senator Thom Tillis (R-NC) in the Senate race 41%-37%. "North Carolina has long been crucial to both parties' hopes of winning a Senate majority. Democrats are counting on Mr. Cunningham to be one of at least four challengers the party needs to win Republican-held seats to take control of the chamber, while Republicans seeking to hold on to their majority will have a far easier time doing so if Mr. Tillis is re-elected," a New York Times report said.
A Quinnipiac University poll of Georgia released October 14 showed Biden leading President Trump 51%-44% (President Trump won by more than five percentage points in 2016). In the Senate race, Democrat Jon Ossoff leads Senator David Perdue 51%-45%. In the Senate special election, Democrat Rev. Raphael Warnock is ahead in a hypothetical head-to-head match-up with Senator Kelly Loeffler (R-GA) 52%-44%; and against Rep. Doug Collins (R-GA) 54%-42%. It is essentially a three-person race — Warnock is at 41% among likely voters, to Rep. Collins' 22% and Loeffler's 20% — and if none gets 50% or more of the vote, the race goes to a runoff between the top two vote-getters on January 5, 2021.
In a Montana State University poll released October 14, Democratic Governor Steve Bullock is ahead by two points at 49% against Senator Steve Daines (R-MT) in the Senate race.
Newsweek reported: "Early voting is underway in a number of states ahead of Election Day and four states — Georgia, Texas, Ohio and Illinois — have already set records outpacing voter turnout in 2016."
Similarly, the Washington Post said: "With less than three weeks to go before Nov. 3, roughly 15 million Americans have already voted in the fall election, reflecting an extraordinary level of participation despite barriers erected by the coronavirus pandemic — and setting a trajectory that could result in the majority of voters casting ballots before Election Day for the first time in U.S. history."
On the heels of Monday's announcement by the OECD Inclusive Framework on BEPS that work on the BEPS 2.0 project on tax challenges from digitalization will continue into the middle of 2021, the French finance minister said the nation will begin collecting its digital services tax (DST) in December, Politico reported. "We won't have [an OECD] deal in January, February, March or April," Bruno Le Maire told reporters Wednesday. "Do we accept that the big winners of the economic crisis, the digital giants, continue to be taxed less than other companies? My response: no. Three times no." Earlier this year, France agreed to suspend collections of its DST in exchange for the US backing off proposed tariffs on French goods.
The IRS added an additional FAQ on the timing for ending the temporary procedures put into place to allow the faxing of forms 1139 and 1045 due to Covid-19.
In a New York Times op-ed based on perceptions of President Trump's taxes, Veronique de Rugy of George Mason University said "we wouldn't want to tax a business that made a $1 million profit this year if it lost $1 million annually over the previous two years" and: "My ideal tax code would eliminate the double taxation of income — taxing the same dollar of income twice (or more). A typical example: taxing corporate income first through the corporate income tax and second through the individual income tax on dividends and capital gains. My tax code would restore 'horizontal equity,' meaning that taxpayers making the same income pay the same amount of taxes." More broadly, the op-ed signals that some are not satisfied with the recent reform of the tax code: if the desire is for a "more equitable system that can actually be enforced by the I.R.S., what we really need is a simpler and fairer tax code."