On The Hill

Republican spell out fixes in Tax Cuts and Jobs Act

On Thursday, Senate Finance Committee Republicans wrote to tax regulators to inform them of Congress’ intent on several provisions of the new tax law that have created problems.  Chairman Orrin Hatch (R-UT) wrote the letter and provided a plan for the Treasury Department and the IRS on how to address these issues as they implement the law.  Finance Republicans want to address rules on restaurants and retail write offs, regulatory certainty on deductions for sexual abuse and harassment settlements, and net losses.  On retailers and restaurants, Congress meant to allow a 15-year recovery period for certain improvements or renovations the owners make on their property, but they have been facing a much longer write-off time frame because of errors in a new single definition of the type of property improvements that qualify under the law.  Without the fix, retailers and restaurants would likely withhold investment plans and face a variety of administrative burdens like amending federal, state, and local tax returns.

The Finance Republicans also stated in the letter that Congress intended attorney fees to remain deductible for victims of sexual harassment and abuse who received settlements, including those involving nondisclosure agreements.  The Senate Finance Republicans and their staff continue to review the Tax Cuts and Jobs Act for any problems that require additional regulatory guidance or technical corrections.  After completing their review, they plan to introduce legislation for those technical corrections.

The full letter from Chairman Hatch is linked here.

Groups Urge Mnuchin to reject European digital tax

In recent months, the European Union has proposed a three percent tax on digital revenues of large multinational companies, and the tech industry is not happy.  Fifteen conservative groups have urged Treasury Secretary Steve Mnuchin to reject the European proposal for taxing digital companies.  They believe the platform released by the European Commission would discriminate against tech companies and give the continent too much power outside its borders.  They feel American tech companies would be hit hardest, but are worried about European efforts that would continue to grow.  Mnuchin indicated in March that the Trump administration opposes this proposal, but European officials feel it is time for tech companies to pay their share of taxes.

The full letter is linked here.