On The Hill

Tax Update (December 6)

Dec 6, 2020 | SHARE  
Biden-Harris Transition
The Biden-Harris transition team announced the following economic nominees and appointees this week:
Janet Yellen, Secretary of Treasury
  • Served as the Chair of the Federal Reserve from 2014-2018
  • Served as the Chair of the Council of Economic Advisers
Neera Tanden, Director of the Office of Management and Budget
Wally Adeyemo, Deputy Secretary of Treasury
  • Served as Deputy Director of the National Economic Council under the Obama-Biden administration
  • First Chief of Staff of the Consumer Financial Protection Bureau
Cecilia Rouse, Chair of the Council of Economic Advisers
  • Former member of the Obama-Biden Council of Economic Advisers
Jared Bernstein, Member of the Council of Economic Advisers
  •  Served as Vice-President Biden’s Chief Economist in first years of the Obama-Biden administration
Heather Boushey, Member of the Council of Economic Advisers
Brian Deese, Director of the National Economic Council
  • Former Senior Advisor to President Obama 
  • Served as Deputy Director of the National Economic Council and Deputy Director and Acting Director of Office of Management and Budget during the Obama-Biden administration
To view a full list of the selected nominations, appointments, and White House staff, click here.
November Jobs Report
On Friday (Dec. 4), the Bureau of Labor Statistics released its November jobs report. Only 245,000 jobs were added last month and the unemployment rate declined to 6.7 percent. Economists predicted around 440,000 jobs would be added in November, however, a surge in COVID-19 cases has contributed to slow job growth. 
To view the November jobs report, click here
2021 House Calendar
This week, House leadership announced the 2021 legislative calendar. The 117th Congress is expected to convene at noon on Jan. 3, 2021.
House Majority Leader Steny Hoyer (D-MD) noted the schedule is always subject to change, especially due to the ongoing COVID-19 pandemic.
“Committee work days may be changed to voting days with sufficient notice. The 2021 schedule seeks to balance voting days, Committee work days, and days for Members to conduct important business in their districts,” Hoyer said in a notice.
To view the calendar, click here.
Appropriations/COVID-19 Stimulus
On Friday (Dec. 4), House Speaker Nancy Pelosi (D-CA) announced she wants to attach a COVID-19 relief package to the $1.4 trillion omnibus spending package currently being negotiated. Pelosi said Senate Majority Leader Mitch McConnell (R-KY) also supported a combined spending bill and COVID-19 relief package when they talked on Thursday (Dec. 3). Notably, Congress must pass a spending bill before Friday (Dec. 11) to avoid a government shutdown.
This week, a bipartisan group of lawmakers released a $908 billion COVID-19 relief package. The legislation would provide $160 billion in state and local aid, $180 billion in unemployment insurance, $288 billion for small businesses, $82 billion for schools, $45 billion for transportation, and liability protections. The proposal does not include another round of stimulus checks. Pelosi emphasized this proposal played a role in the most recent relief negotiations, which gained momentum this week.
At this point, there are still various key issues that need to be resolved on both the appropriations package and COVID-19 relief deal. Lawmakers may pass a short-term continuing resolution (CR) to allow more time for negotiations.[1]
Senator Mark Kelly
On Wednesday (Dec. 2), Mark Kelly (D-AZ) was sworn into the Senate after winning a special election against former Sen. Martha McSally (R). Republicans now only have a 52-48 majority in the Senate.
Fed Nominee
On Thursday (Dec. 3), the Senate voted 48-47 to confirm Christopher Waller to the Federal Reserve Board of Governors. Waller has served as research director at the St. Louis Federal Reserve Bank. There is still one vacant seat to be filled, however, President Trump’s other nominee, Judy Shelton, has experienced opposition from Democrats and some Senate Republicans, leaving her nomination uncertain.[2]
On Monday (Nov. 30), the Government Accountability Office (GAO) published a report that found about 14,000 companies had applied for tax refunds created in COVID-19 relief packages. Around two-thirds of refund requests from businesses were for less than $100,000. Additionally, it found that the Internal Revenue Service (IRS) took about 40 days to process the refund. The preliminary data shows that fewer companies are using the tax breaks than expected, especially with provisions dealing with net operating losses (NOL).[3]
To view the GAO report, click here.
Digital Taxes
On Wednesday (Nov. 25), the French Finance Ministry confirmed that tech companies were notified how much they will need to pay for the country’s digital services tax (DST). The DST will need to be paid by the end of 2020. In October, French Finance Minister Bruno Le Maire said France would reinstate the DST after talks at the Organization for Economic Cooperation and Development (OECD) failed to agree to a global DST this year.[4]
On Wednesday (Nov. 25), a spokesperson for Senate Finance Ranking Member Ron Wyden (D-OR) said the move by France is an “escalation against American employers” and said if France does not change its course the U.S. “will have no choice but to use every available tool to defend against these predatory taxes.”[5]
On Tuesday (Dec. 1), Le Maire said France will collect digital service taxes regardless of the U.S. threat of tariffs. Le Maire added that France would ask the EU to respond to any U.S. tariffs on French goods. The U.S. would apply $1.3 billion in tariffs on French cosmetics, handbags, and other imported goods in response to the French digital tax. This year, France will collect around €400 million in taxes from tech companies.[6]
On Monday (Nov. 30), Canada’s Finance Department proposed the country will impose a DST that would take effect in 2022 if a global deal is not reached. Prime Minister Justin Trudeu’s political party, the Liberal Party, promised to release more details on a DST in its upcoming spring budget. According to a document from Finance Minister Chrystia Freeland, the proposed DST could raise around C$3.4 billion in revenues over five years.[7]
House Committee Changes
On Thursday (Dec. 3), House Democrats elected Rep. Rosa DeLauro to replace retiring Rep. Nita Lowey (D-NY) as Chairwoman of the House Appropriations Committee. Notably, House Ways and Means leadership will stay the same with Chairman Richard Neal (D-MA) and Ranking Member Kevin Brady (R-TX).
On Thursday (Dec. 3), House Minority Leader Kevin McCarthy (R-CA) released who will serve as Ranking Members for the 117th Congress. Representative Jason Smith (R-MO) will serve as House Budget Ranking Member and Rep. Blaine Luetkemeyer (R-MO) will serve as House Small Business Ranking Member.
To view all the House Ranking Members in the 117th Congress, click here.
To view all the House Committee Chairs in the 117th Congress, click here.
On Tuesday (Dec. 1), the Senate Banking, Housing, and Urban Affairs Committee held a hearing entitled “ The Quarterly CARES Act Report to Congress” with witnesses Treasury Secretary Steven Mnuchin and Federal Reserve Chair Jerome Powell.
To view a summary of the hearing, click here.
On Wednesday (Dec. 2), Mnuchin and Powell testified before the House Financial Services Committee in a hearing entitled “Oversight of the Treasury Department’s and Federal Reserve’s Pandemic Response.”
To view a summary of the hearing, click here.
[1] Emma, Caitlin & Caygle, Heather. “Pelosi eyes combining Covid aid with mammoth spending deal.” Dec. 4 2020.
[2] Brown, Courtenay. “Trump nominee Christopher Waller confirmed to Fed board.” Axios, 3 Dec. 2020.
[3] Faler, Brian. “New GAO figures show lower-than-expected ‘NOL’ uptake.” Politico Pro, 30 Nov. 2020.
[5] Lorenzo, Aaron. “Wyden: France’s tax bills for U.S. tech companies an ‘escalation’ of dispute.” Politico Pro, 25 Nov. 2020.
[6] Braun, Elisa. “Le Maire: France ‘will not bow’ to U.S. sanctions threat over digital tax.” 1 Dec. 2020.
[7] Blatchford, Andy & Allan, Sue. “Canada pledges unilateral tax on digital giants in 2022 if global talks fail” 30 Nov. 2020.


The Week Ahead

For the main events of the next week and more, go straight to the key events on the house.gov website.

Find out more >

The Week Ahead

For the main events of the next week and more, go straight to the key events on the senate.gov website.

Find out more >

Post Archive