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Late last night, the Senate approved 71-19 a one-week continuing resolution (CR) to extend government funding through December 23, as Congress prepares to try to pass an omnibus appropriations bill next week before departing for the holidays. "With Republicans set to take control of the House in early January and retiring lawmakers eager to pass a final set of funding and legislative priorities, Democrats and several Republicans have labored to complete the spending package before the congressional term ends, rather than leaving one to be finished in the new year," the New York Times reported.

Punchbowl reported this morning that text of the omnibus isn't expected to be released until Monday. Inclusion of any tax items isn't completely clear, though members expressed optimism that a SECURE 2.0 retirement package would be included. Thursday evening was said to be the deadline for members to reach agreement on tax and retirement items for inclusion.

House Ways & Means Ranking Member Kevin Brady (R-TX) said in Politico that he believes appropriators are leaving room in the omnibus for a very narrow tax title, but that the retirement reform bill could move without the inclusion of any other tax items, such as R&D expensing and an expanded Child Tax Credit. Bloomberg Tax cited Senate Finance Committee chair Ron Wyden (D-OR) as saying Democrats "haven't been able to get enough traction" on a deal that includes an expanded child tax credit and business tax breaks, in a report citing Republicans as saying they will make relief from the IRC Section 174 R&D amortization requirement a priority next year.

Tax Notes reported Rep. Brady as saying he believes leadership is prepared to put the retirement package into the omnibus if the mini-tax-title is derailed. "Besides the expensive marquee items being debated, a package of much smaller tax extenders, such as renewing an expired three-year amortization period for racehorses age two and younger, is being considered," the report said.

Politico Morning Tax reported about relief from the third-party network transactions reporting threshold reduction to $600 under the American Rescue Plan Act, "Lawmakers in both parties have shown an interest in offering taxpayers some relief from that requirement, though it would be difficult for any one single provision to slip through with so many others likely on the outside looking in."

Global tax — On December15, the Council of the EU (i.e., the EU Member States) unanimously adopted the Directive ensuring a global minimum level of taxation for multinational enterprise (MNE) groups and large-scale domestic groups in the Union (the Directive). This adoption follows a Permanent Representatives Committee II meeting (COREPER II) held on December 12 where EU Member States' ambassadors reached unanimous agreement on the Directive and made the decision to advise the Member States to adopt the Directive via written procedure.

The text in the adopted Directive is the version that was published by the Czech EU Presidency on November 25. The adopted version includes only editorial changes following a legal-linguistic review by the EU institutions, as compared to the previous compromise text of June 21. EU Member States have until December 31, 2023, to transpose the Directive into national legislation with the rules to be applicable for fiscal years starting on or after December 31, 2023, with the exception of the UTPR which is to be applicable for fiscal years starting on or after December 31, 2024. An EY Tax Alert has details.

In a December 15 letter to Treasury Secretary Yellen, Senate Finance Committee Ranking Member Mike Crapo (R-ID), Senate Foreign Relations Committee Ranking Member Jim Risch (R-ID), Ways & Means Ranking Member Brady and several other Republican members of Congress said, in part: "For the past two years, the Biden Administration has routinely made commitments in the OECD negotiations it has no authority to fulfill. Despite Treasury's actions to date, it cannot dictate U.S. tax law or compel Congress to act … While some may believe that implementation by foreign countries of the model rules, including the UTPR, will lead the United States to follow suit, Congress's hand will not be forced. Nor will Congress sit idly by as U.S. companies and profits are taxed in a manner inconsistent with U.S. law and our bilateral tax treaties."

Today, December 16 (12:00 p.m.), is the EY Webcast, "Tax in the time of COVID-19: update on legislative, economic, regulatory and IRS developments." Register.

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