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  • Trump is proposing to make ideas tax-free. What would that indicate for employees?

    Trump is proposing to make ideas tax-free. What would that indicate for employees?

    WASHINGTON (AP) — Previous President Donald Trump’s brand-new proposition to leave out ideas from federal taxes is getting strong evaluations from some Republican legislators, though significant concerns stay about the effect of the policy and how it would work.

    What’s particular is that a modification in the tax of ideas would impact millions. The U.S. Bureau of Labor Data approximates there are 2.24 million waiters and waitresses throughout the nation, with ideas comprising a big portion of their earnings.

    A take a look at what Trump’s proposing and the possible political and financial implications:

    TRUMP’S ELECTION-YEAR PITCH IN NEVADA

    Trump revealed his tax-free-tips prepare at a June 9 rally in Nevada, an essential battlefield state with 6 electoral votes in the race for the White Home. President Joe Biden won the state in 2020, however the Trump project wishes to put the state in play this fall.

    Nevada has the greatest concentration of tipped employees in the nation, with about 25.8 waiters and waitresses per 1,000 tasks, followed by Hawaii and Florida.

    “To those hotel employees and individuals who get ideas, you are going to be extremely delighted, due to the fact that when I get to workplace we are going to not charge taxes on ideas, individuals making ideas,” Trump stated at the rally. “… We’re going to do that right now, very first thing in workplace.”

    The pitch establishes a sharp political contrast in between Democrats and Republicans. While Trump presumes that a tax cut would assist employees, Democrats have actually typically backed efforts to increase per hour salaries — and it’s an open concern which approach resonates more with citizens.

    The Culinary Union, which represents 60,000 employees in Las Vegas and Reno and is backing Biden, dismissed Trump’s strategy as a stunt.

    “Relief is certainly required for idea earners, however Nevada employees are wise sufficient to understand the distinction in between genuine services and wild project guarantees from a founded guilty felon.” Culinary Union Secretary-Treasurer Ted Pappageorge stated in a declaration.

    Lael Brainard, director of the White Home National Economic Council, decreased to talk to the concept drifted by Trump due to the fact that, as a federal worker, she’s not expected to talk project politics.

    “What I can state is that President Biden has actually defended genuine services that really resolve employees’ genuine requirement for reasonable salaries, we believe, a lot more efficiently,” she stated, including that tipped employees in Nevada would get a $6,000 earnings increase from a greater base pay and the removal of the tipped base pay.

    HOW WOULD THE TAX EXEMPTION WORK?

    Trump has actually not defined whether he wishes to exempt ideas from simply earnings taxes or from the payroll tax too. The payroll tax funds Medicare and Social Security.

    For employees, a blanket exemption would indicate more take-home income. And for the federal government, it might indicate bigger deficit spending.

    The Committee for an Accountable Federal Spending plan, a nonpartisan financial guard dog group, has actually approximated that excusing ideas from both earnings and payroll taxes would decrease federal profits by $150 billion to $250 billion over the next years.

    The committee stated excusing ideas from tax would likewise lead companies and employees to reclassify salaries as ideas where possible. The more that takes place, the more that federal deficits would boost. A 10% increase in ideas, for instance, would bump up the committee’s forecast for lost federal income to a variety of $165 billion to $275 billion over the next years.

    Congress certainly would take a look at Trump’s proposition on ideas as it thinks about which parts of the 2017 Tax Cuts and Jobs Act are permitted to end after next year, consisting of the lower specific tax rates. Legislators are currently prepping for the job, though Trump’s proposition is something that lots of had actually not thought of till just recently.

    Rep. Vern Buchanan, R-Fla., a senior Home Ways and Way Committee member, stated legislators will need to think about the general expense of the ideas proposition and how to spend for it.

    “I wish to be delicate due to the fact that they strive, you can’t discover sufficient waiters, and undoubtedly a huge part of their profits is ideas,” Buchanan stated. “All these programs sound excellent. Everyone wants to pay less taxes, however we’ve got to foot the bill.”

    “I understand he’s attempting to ensure individuals at that earnings level have relief as much as possible. We may be able to do the exact same thing in making his tax cuts more irreversible and most likely to resolve lower-income individuals,” stated Rep. Kevin Hern, R-Okla., who likewise serves on the Ways and Way Committee, which has jurisdiction over tax policy.

    TRADE-OFFS OF NOT TAXING SUGGESTIONS

    Like lots of tax propositions, Trump’s push to exempt ideas might have unexpected repercussions.

    Howard Gleckman, a senior fellow at the Tax Policy Center, a joint endeavor of the Urban Institute and Brookings Organization, argues that Trump’s proposition might really backfire for lots of tipped employees.

    For instance, some clients might react to tax-free ideas by lowering their gratuity. Second of all, it might take the steam out of efforts in some states to slowly increase the base pay for tipped employees so that their base pay remains in line with the base pay for other employees.

    “The lure of tax-free earnings might turn lots of employees versus the shift from ideas to salaries,” Gleckman composed in a post.

    Gleckman likewise questioned why a service employee must prevent paying taxes on ideas rather than a storage facility employee making the exact same quantity. He kept in mind that while Trump assured to reverse the tax on ideas right now, just Congress can reverse federal taxes, and “for factors of performance, fairness, and sound tax administration, let’s hope it doesn’t.”

    LOOKING AHEAD

    Democrats have actually mostly dismissed Trump’s proposition as a trick to win over citizens.

    Sen. Debbie Stabenow, a senior member of the Senate Financing Committee, noted she was a waitress in college, calling it “truly effort.” She chooses increasing the base pay for tipped employees to match the base pay for other employees.

    “From my viewpoint, I don’t believe (Trump’s) proposition is severe and I don’t believe it does enough to resolve low-wage working individuals,” Stabenow stated.

    Sen. Ron Wyden, the chairman of the Senate Financing Committee, stated Trump was “tossing out great deals of concepts as he goes,” however his record as president shows a focus on tax breaks for the rich and corporations.

    “All these things he throws away every day, I’ll think it when I see it,” Wyden stated.

    However Trump’s interest for the concept appears to be growing. The tax guarantee has actually given that ended up being a staple of Trump’s rallies and conferences, and he raised his proposition while meeting GOP legislators and magnate in Washington recently.

    “I believe it’s really a really wise concept. The guys and females who count on ideas for their profits, they are working their tails off,” stated Sen. Ron Johnson, R-Wis. “That’s great, targeted tax reform right there.”

    Some legislators and allies have actually started tweeting pictures of their dining establishment costs with handwritten messages created to get the word out about Trump’s guarantee. Rep. Derrick Van Orden, R-Wis., composed “Vote Trump!” and “No Tax on ideas!” on his costs from a Milwaukee dining establishment.

    The artist Kid Rock, a popular Trump fan, shared a picture on X.

    “An elect Trump is a choose no tax on ideas!!” he composed on his invoice. He tipped $400 on a $1,143 costs at a costly steakhouse, according to the picture.

    ___

    Associated Press author Jonathan J. Cooper in Phoenix added to this report.

  • Mike Pence’s structure introduces a $10 million election-year project to maintain Trump-era tax cuts

    Mike Pence’s structure introduces a $10 million election-year project to maintain Trump-era tax cuts

    WASHINGTON (AP) — Previous Vice President Mike Pence’s structure is releasing a $10 million project to maintain the Trump-era tax cuts that are set to end after next year as he presses conservatives not to wander off from the battle before the November election.

    Advancing American Liberty launched a 13-page plan Thursday with arguments being made to Capitol Hill and to citizens in swing states, especially in those that might choose control of the Senate.

    “We will be prompting conservative leaders to join us in this battle,” according to the file.

    The group pictures a prolonged project that will spin into 2025 when the White Home and Congress will need to choose whether to keep the tax code as authorized in the 2017 tax law when Republican politician Donald Trump was president or make modifications. If absolutely nothing is done, much of the private tax policies would end after 2025.

    Much will depend upon power centers in your home and Senate and which celebration manages the White Home.

    Democratic President Joe Biden has actually proposed keeping the tax cuts for individuals making under $400,000 a year while raising the business rate and presenting greater taxes on the rich. Trump, the presumptive Republican candidate for the White Home, likewise wishes to keep the tax cuts for lots of families, however he proposes reducing the business tax rate to 20%, from the existing 21% rate.

    “Washington has a costs issue, not an earnings issue,” Pence stated in a declaration. “Our nationwide financial obligation runs out control, and taxing the American individuals more is not the option.”

    Previous Sen. Pat Toomey of Pennsylvania, a Republican politician who contributed in crafting the 2017 tax expense, is a strong fan of the structure’s project to extend the tax policies.

    The push comes as Congress has actually silently started workshopping tax policy before next year’s session, when legislators need to attend to the concern or danger enabling a few of the 2017 policies to end, possibly raising taxes for lots of people.

    The federal balance sheet remains in the red, the nonpartisan Congressional Spending plan Workplace stated today, with costs outmatching profits. That remains in big part since of the COVID-era expenses, moneying for the war in Ukraine and the expenses of Medicare, Medicaid and other programs especially to take care of an aging U.S. population.

    A CBO report in Might approximated that extending the arrangements of Trump’s Tax Cuts and Jobs Act would increase deficits by almost $5 trillion into 2034.

  • Kansas Legislature adopts $2.3 billion, 5-year tax cut despite bipartisan forecast of veto

    Kansas Legislature adopts $2.3 billion, 5-year tax cut despite bipartisan forecast of veto

    Sen. Caryn Tyson, R-Parker, and Sen. Virgil Peck, R-Havana, discuss with House negotiators details of a tax reform bill adopted by the House and Senate and forwarded to Gov. Laura Kelly. (Kansas Reflector screen capture from Kansas Legislature’s YouTube channel)

    TOPEKA — The Kansas Legislature passed a tax reduction plan early Wednesday that closely mirrored the package vetoed by Gov. Laura Kelly that included property tax relief, elimination of sales tax on groceries, an income tax exemption for Social Security benefits, an increase in the standard deduction on tax filings, and transition to a two-bracket income tax system.

    House Bill 37 would lower personal income tax rates below current law, but rate changes were slightly less generous than under a plan the Democratic governor had rejected. On Monday, the Senate refused to follow the House’s lead and override Kelly’s veto. On the rebound, the Senate voted 25-9 for the revised tax overhaul bill consuming a projected $2.3 billion in revenue over the next five years. The House expressed greater appreciation for latest plan and passed it 108-11.

    On the final day of the 2024 regular session of the Legislature, weary Republican and Democratic legislators predicted Kelly would also find this bill unsustainable for the state treasury. In advance of that vote, the governor’s chief of staff warned she would veto the bill and call the Legislature back to Topeka in a couple weeks.

    “This bill is not going to become law,” said Sen. Tim Shallenburger, a Baxter Springs Republican who voted for the latest incarnation of tax reform. “It’s time we go down to the second floor and try to figure out what in the world the governor will accept. If we can’t accept it, we go home and do nothing. If we can, we ought to do it.”

    The governor has repeatedly vetoed tax bills presented by the GOP-led Legislature likely to create revenue problems for state government within three to five years. Those financial projections assumed legislators would sidestep the politically challenging task of adopting budget cuts.

    Senate Minority Leader Dinah Sykes, a Lenexa Democrat who voted against the latest bill, said other packages floated in the Capitol during Tuesday’s marathon workday might have earned the governor’s signature. She said the bill passed by lawmakers guaranteed a special session in May dedicated to the search for common ground on tax policy.

    “I think this has been an exercise in futility,” said Sykes, who cringed at the GOP’s interpretation of fiscal responsibility. “Republican leadership sent yet another plan to the floor that they knew was dead on arrival.”

     

    ‘For our constituents’

    Kelly said the bill that she vetoed would carry a five-year price tag of $2.5 billion, which was too expensive — especially when combined with other tax legislation passed by the Legislature. She said it would be irresponsible for the state to burn through reserves and create a state revenue shortfall by 2029.

    Sen. Caryn Tyson, a Parker Republican and chair of the Senate’s tax committee, said lawmakers ought to place interests of Kansas taxpayers above personal political considerations by accepting the $2.34 billion version.

    “This is for our constituents,” Tyson said. “Not for the people in this building.”

    House Minority Leader Tom Sawyer, D-Wichita, sought to rally House Democrats to the bill. He said the House and Senate negotiators made a good-faith effort to reduce the overall cost of the program and make effective use of the state’s surplus cash reserve.

    With the clock ticking on the session, Senate and House Republicans scrambled to revise details of a tax bill while fully aware the governor could call them back to the Capitol during campaign season if they chose not to adopt sustainable tax cuts.

    In the tax negotiations, Sen. Tom Holland, D-Baldwin City, confronted Rep. Adam Smith, the Weskan Republican and chairman of the House tax committee, about the state’s long-term financial outlook.

    “When you look at the cost of the fiscal note in the out years, you feel comfortable that you can hit that on the budget?” Holland asked.

    Smith said revenue was only one side of balancing the budget. The other option would be to slash expenditures, he said.

    “If we force this tax relief into our state law, it forces us to be more responsible on the budget,” Smith said. “I wish I could guarantee more than that, trust me, but we need to manage our budget as well.”

    Other Republicans expressed concern about ballooning budget appropriations. Lawmakers adopted a revised budget that included a litany of last-minute additions — including an attempt to lure the Kansas City Chiefs or Royals across state lines.

    Rep. Trevor Jacobs, R-Fort Scott, said the spending blueprint was packed with “a lot of pork.”

    “We’re supposed to be here to protect our constituents, not lobbyists, not special interest groups,” Jacobs said. “And this is the problem. It’s not about the next generation. It’s about the next election. And this is one of the reasons why I’m happy not to come back — because of the backdoor deals, of all of this nonsense that happens.”

     

    More of the details

    Under the bill sent to the governor, the state income tax for top earners in Kansas who were married and filing jointly would decline from 5.7% under current law to 5.57%. The last bill to be rejected by Kelly would have reset that upper bracket at 5.55%. Instead of cutting the lower bracket from 5.25% to 5.15%, the rate in the bill headed to Kelly’s desk was 5.2%.

    The new bill would exempt Social Security income from the state’s individual income tax in the 2024 tax year. It would accelerate elimination of the state’s 2% sales tax on groceries to July 1 rather than Jan. 1.

    The legislation would increase standard deduction amounts from $3,500 to $3,605 for single filers, $8,000 to $8,240 for married filers, and $6,000 to $6,180 for a head of household beginning in tax year 2024.

    The governor also must take into account an increase in the personal exemption allowance, currently set at $2,250 for all persons on the return, to $18,320 for married couples filing joint returns and $9,160 for all other filers. The bill included an additional $2,320 exemption for each dependent listed on the return.

    It would raise the amount of appraised value residential property value exempt from the statewide school finance levy to $100,000 from the current amount of $42,000. In addition, the K-12 public education mill levy was cut from 20 mills to 19.5 mills with that financial gap to be backfilled by the Legislature from the general state treasury.

    Rep. Henry Helgerson, D-Wichita, had a parting message to the Legislature: “We don’t have money for this tax bill.”

    The post Kansas Legislature adopts $2.3 billion, 5-year tax cut despite bipartisan forecast of veto appeared first on Kansas Reflector.

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  • Iowa lawmakers pass income tax cut, budget bills in push to end session

    Iowa lawmakers pass income tax cut, budget bills in push to end session

    The Iowa Statehouse. (Photo by Perry Beeman/Iowa Capital Dispatch)

    Iowa lawmakers passed several remaining priority bills of the Republican leaders as well as remaining budget bills Friday and early Saturday as legislators sought to wrap up the 2024 legislative session.

    It was the second night of post-midnight debate this week at the Iowa Capitol. Most of the bills passed Friday headed directly to Gov. Kim Reynolds, with Republican leaders having reached agreements on spending and final policy bills.

    Some bills contained last-minute changes, including a move in the House to approve a moratorium on new casino licenses.

    Lawmakers met in closed door meetings much of the day Friday, reaching agreements and compromises on the remaining bills — as well as looking for spaces to add in legislative proposals that died earlier in session.

    While some policy priorities of Republicans, like the casino moratorium, made it in during the final hours of debate this session, House Minority Leader Jennifer Konfrst criticized Republican leaders for not allowing Democratic proposals to advance this session. In a news conference with reporters, Konfrst also criticized Republicans for the drawn-out end of session, saying that it is reflective of earlier issues and disagreements between the chambers during the session.

    She pointed to a House bill on fetal deaths that would have added “unborn personhood” language that the Senate did not advance over concerns about its impact on in-vitro fertilization treatment, and a spending oversight included in the Area Education Agencies legislation.

    “Republicans in disarray, Republicans (are) not agreeing with each other, because it’s not about the policy,” Konfrst said. “It’s always about politics. If they cared about the policy, they would be more accurate in their policy. They would focus more on what’s in the bills and less than what’s in the headlines.”

    Governor signs bill for school firearms

    As lawmakers worked through the day to pass bills, Reynolds signed into law several measures that were approved by lawmakers this session. Chief among them was a bill changing the statute of limitations for child sexual abuse survivors involved in the Boy Scouts of America settlement, sent to Reynolds Friday – the deadline for the measure to become law for the impacted victims to receive payouts equitable to participants in other states.

    The governor also signed more than 40 other bills Friday. Measures signed into law include:

    • House File 2586, legislation allowing school employees to go through a training process to receive a permit from the Iowa Department of Public Safety for carrying a firearm on school grounds and providing qualified immunity for school districts and staff from criminal and civil liability for damage related to firearm usage involving “the application of reasonable force.” 

    • House File 2153 changes reporting requirements for the Iowa College Student Aid Commission, having them file reports on the number of students who received state financial aid rather than loan repayment or forgiveness and having them include how awards are determined. It also strikes certain reporting requirements. 

    • House File 2240 classifies creating an image or video portraying the likeness of a person engaged in a sexual act or in a state of full or partial nudity without the consent of the person depicted as an act of first-degree harassment.

    Here are some of the final bills passed by lawmakers before adjournment for the 2024 session:

    Final legislative proposals pass

    Tax omnibus: After quickly moving Senate File 2442 and its House companion through the committee process Thursday, the Senate approved the bill speeding up 2022 individual income tax cuts and setting a flat tax rate Friday morning.

    Sen. Dan Dawson, R-Council Bluffs, said that in the eight years since the Republican trifecta took control at the Iowa State Capitol, the Iowa tax code will have transformed “from one of the least competitive in the United States to something that will be one of the most competitive.” The individual income tax changes in this bill add to that progress, he said.

    The legislation received bipartisan support and passed 36-7. The measure would lower Iowa’s individual income tax to a 3.8% flat rate beginning in 2025, a cut from the 3.9% flat income tax by 2026 approved in the 2022 tax bill.

    Dawson said the tax cut is “responsible, sustainable, as well as big. Dawson and Rep. Bobby Kaufmann, who managed the House bill, said the tax cuts will be paid for through excess tax revenue in this year’s budget, in addition to a withdrawal from Iowa’s Taxpayer Relief Fund. The bill also includes measures that allow future withdrawals from the relief fund if state revenues fall below the state’s spending during a fiscal year.

    Some Democrats said this approach could lead to cuts in services that Iowans rely on in the future. Sen. Herman Quirmbach, D-Ames, said taxes are necessary to finance important state-funded services like education and public safety.

    “When we look at the net impact of any tax proposal, the benefit side is how much of a tax cut do you get?” Quirmbach said. “The downside is how much in the way of services do you lose? It’s easy to focus on just, ‘hey, let’s cut taxes,’ and not talk about lost services.”

    Sen. Nate Boulton, D-Des Moines, said Iowa has “a long ways to go to get tax fairness” in Iowa, calling for tax credits and exemptions that apply more to wealthy Iowans and large businesses rather than lower- and middle-income families.

    “I also understand that this isn’t the tax bill we would have drafted on our side,” Boulton said. “… That said, several of my Democratic colleagues can also see something clear in this tax proposal. And that is for the first time in dealing with tax policy we’re actually seeing working class Iowans get a quicker step towards tax relief.”

    The legislation also includes changes to last year’s property tax law, including changes to thresholds that determine how much excess revenue is must be dedicated to reducing general fund levies for cities and counties with higher percentages of total assessed property value growth.

    The bill also includes a measure allowing counties to eliminate county compensation boards, the panels that recommend salary increases for elected county officials. Kaufmann called this provision his favorite part of the bill during floor debate in the House, saying that such boards are “one of the largest contributors to the explosion and growth of property taxes in the state.”

    Rep. Sami Scheetz, D-Cedar Rapids, offered an amendment to reduce Iowa’s sales tax by one cent – a tax he says every Iowan pays.

    “As opposed to the legislation we’re considering, which will be a tax cut for about two-thirds of Iowans, this will be a tax cut of 100% of Iowans,” Scheetz said. “As many people in the state know, the sales tax is the most regressive form of taxation. It hits the people in the state who need help the most the hardest.”

    The amendment was ruled not germane to the legislation.

    Kaufmann said the bill will result in over $1 billion saved, and said the legislation shows that the Republican trifecta at the Iowa Capitol are committed to lowering costs for taxpayers and fiscal responsibility for the government.

    “Every year we lower the rates, every year revenue goes up,” Kaufmann said. “We in Iowa show how we pay for it and we can give Iowans the confidence that we will make sure that these are sustainable.”

    The bill goes to Reynolds for final approval.

    Tax constitutional amendment: Senate Joint Resolution 2004, a move toward amending the state constitution to enshrine a flat tax rate, passed the House 58-35.

    This proposal is moving in conjunction with House Joint Resolution 2006, another constitutional proposal that would require that future increases to the state income tax rate get support from two-thirds of the legislature to pass.

    Boards and commissions: The Senate approved Senate File 2385 with a 32-14 vote, sending it to Reynolds.

    The measure makes a significant reduction to the number of boards and commissions in the state, consolidating 9 boards into three new panels and eliminating another 74. The legislation also makes changes to the powers and make-up of some panels.

    One of the most controversial components of the proposal was language changing the Iowa Civil Rights Commission. In the bill, the powers and authority given to the commission through the Iowa Civil Rights Act would be transferred to the Iowa Office of Civil Rights and the state’s Civil Rights Commission director.

    The Iowa-Nebraska National Association for the Advancement of Colored People (NAACP) spent the last week lobbying at the Capitol and rallying supporters in opposition to the proposal, asking for lawmakers to kill the bill or to amend the bill striking these provisions.

    The NAACP also opposed changes consolidating multiple commissions dedicated to specific minority populations in Iowa, including the commissions on the status of African Americans, Asian and Pacific Islanders, Persons with Disabilities and Women. Advocates for the bill say these populations will still be represented through the Iowa Human Rights Board, with a person from each community being a member of the body.

    Sen. Janice Weiner, D-Iowa City, said the House amendment makes some positive changes to the legislation, but that the bill remains “an upside-down process.” She said she supported the review committee and process established by the bill, but said she cannot support the changes made to boards and commissions.

    “That’s literally all we should have done,” Weiner said, referring to the review committee. “It should have been a short and simple bill. This bill still cuts too many boards that are still needed. … And it ignores what we’ve heard from many Iowans on a great many issues. Iowans, in my view, deserve a better process.”

    The bill’s floor manager, Sen. Chris Cournoyer, R-LeClaire, and other Senate Republicans did not address Democrats’ criticisms Friday. But during the House debate on the bill Tuesday, Rep. Jane Bloomingdale, R-Northwood, emphasized that the review committee has the ability to recommend panels cut by this legislation be restored if needed.

    Reynolds said the boards and commissions legislation builds off of the work started with the 2023 state government realignment law in making state government more efficient and cost-effective.

    “The bill headed to my desk today is a continuation of that work,” Reynolds said in a statement. “It eliminates unnecessary and redundant boards and commissions, returning accountability to the people of Iowa through their elected representatives. Iowa’s boards and commissions have never been comprehensively reviewed and adjusted for effectiveness, only growing in numbers and scope over our state’s history. Today, we reverse that trend.” 

    Casino moratorium: The House voted to amend Senate File 2427, a bill dealing with the Department of Revenue on issues including to taxes on sports wagering, cigarette and tobacco, to include a moratorium on new casino licensing until 2029.

    Scheetz said the amendment to the bill dropped just an hour before representatives reconvened to debate the bill after 12:30 a.m. Saturday. He criticized the bill for unfairly limiting Iowa cities’ ability to pursue gaming operations.

    “This amendment, filed on a completely irrelevant bill at the last second of our legislative session, is wrong,” Scheetz said. “It’s gonna hurt gaming in our state, and effectively, this legislation will be a permanent ban on new casinos in the state of Iowa indefinitely.”

    Scheetz said it is not the prerogative of the Legislature to deny cities and their residents the right to have a casino operation. But Kaufmann disagreed, saying that it is the Legislature’s role to set policy on these issues.

    He also pushed back against criticisms of the timeline of introducing the proposal as an amendment to an unrelated bill, saying that the moratorium is “far from a new topic.”

    “I believe it’s been discussed, at least on my end, every week of every month of session,” Kaufmann said. “We just happen to reach critical mass at this time.”

    Opioid settlement fund: The Senate passed Senate File 2395, providing funding for specific nonprofits. $3 million goes to Youth and Shelter Services, $8 million to Community and Family Resources and $1.54 million in funding to the state Attorney General’s office under the bill..

    The Senate amended out the House’s proposal, passed Thursday, of creating an advisory council to oversee the allocation of money from the Opioid Settlement Fund. In future years the council would oversee a grant program awarding one-time grants to applicants for opioid addiction and treatment services, reviewing and making recommendations to lawmakers about the funding of grant applications each year.

    Senate Democrats criticized Republicans’ removal of the advisory council, calling for keeping this provision in. Weiner said the advisory councils are required by some opioid settlement agreements reached between state and local governments and businesses involved in the opioid crisis.

    “Red and blue states alike have created advisory committees to allocate these funds for purposes of transparency and accountability,” Weiner said. “And because it’s required under the settlement agreements to avoid the very issues of lack of accountability and diversion of funds that we experienced with the tobacco agreement.”

    The bill’s floor manager, Sen. Mark Costello, R-Imogene, said the advisory council component was taken out because there was dissent between Senate Republicans, House Republicans and the governor on whether to use an advisory committee or a different proposal.

    He said that while an agreement hasn’t been reached, “what we would like to do is just get this money out.”

    “And so we’re just going to go to the things we all agreed on,” Costello said.

    The amendment striking the advisory council was approved. Sen. Janet Petersen, D-Des Moines, said that she wasn’t sure an agreement had been reached with the House, but called for advancing the measure as amended to ensure some funding is distributed.

    “The most important thing is that we have these dollars getting out to help save lives in Iowa,” Petersen said. “So I would encourage the body to support the bill so that we can get something done this year and not waste another year without dollars being spent.”

    Appropriations bill compromises move to governor

    Education funding: The Senate sent Senate File 2435 to the governor’s desk Friday with no debate. The legislation appropriates funds for the Iowa Department of Education, Department for the Blind and the Iowa Board of Regents and the universities it governs.

    Each of the state universities would receive a 2.5% increase in general university funding, bringing allocations to more than $223 million for the University of Iowa, more than $178 million to Iowa State University and almost $102 million to the University of Northern Iowa. Iowa tuition grant funding would also see a 2.5% increase to more than $52 million.

    An amendment to the bill, sent by the House late Thursday, changed how state funds to Iowa’s community colleges are distributed. Sen Tim Kraayenbrink, R-Fort Dodge, said the amendment still increases total community college appropriations by $7 million, but half of those dollars will go to providing “more equity” to the six colleges that see the lowest average amount of state funding per student. The other $3.5 million was allocated according to the current aid distribution formula. 

    Private universities would be required to submit annual reports on the number of students receiving Iowa tuition grants and other information on them and graduate outcomes, at the risk of students not being eligible for tuition grants if they do not submit reports. 

    State universities would also be prohibited from establishing, maintaining or funding diversity, equity and inclusion offices under the bill, unless required by state or federal law or accreditors. 

    Rep. Adam Zabner, D-Iowa City, said during House debate that this legislation does not adequately fund education in Iowa, which will place more burdens on families and fail in helping them and employers looking for educated workers. It does, however, include fear mongering about indoctrination and politicization of diversity, equity and inclusion, he said. 

    “This is an embarrassment,” Zabner said. 

    Rep. Carter Nordman, R-Panora, said the legislation helps keep costs of education low for students through continued and additional funding to grants and loan repayment programs. 

    “I believe this budget accomplishes many priorities House Republicans set out to get done this year, and it is consistent with the responsible budgeting practices we have set forth over the past decade-plus,” Nordman said. 

    The bill would also create processes to deal with chronic absenteeism and truancy in schools, having school district boards adopt policies for interventions and penalties when a student is chronically absent with the county attorney’s involvement. Sen. Molly Donahue, D-Cedar Rapids, said in Senate debate Thursday night she’s seen chronic absenteeism plans fail before, causing families to pull their students out of school in order to avoid penalties from them. 

    School districts are already putting in the work to lower absenteeism, she said, and putting in these rules would throw out their efforts and make them start all over again. 

    “The prescriptive and high state mandates … do not work and they certainly do not improve outcomes for students,” Donahue said. 

    Judicial branch: Rep. Brian Lohse, R-Bondurant, said he has learned “you take wins where you can get them and live to fight another day” as a budget chair.

    But with the passage of Senate File 2436, he said that he did not have to make many compromises.

    “They said you don’t always get what you want,” Lohse said. “But in this case, I kind of did.”

    Lohse said both House Republicans and Democrats were very clear about their goals for the judicial branch appropriations, and he was “delighted” to report that most of those goals were met.

    Included provisions were a 5% increase to the salaries of judicial officers. Pay increases for judges was first brought up in the Condition of the Judiciary address by Chief Justice of the Iowa Supreme Court Susan Christensen in January, who said Iowa’s judicial pay has not kept pace with inflation and is a major contributor to judicial vacancies across the state.

    Another request Christensen made was to return the Judicial Retirement System from its current variable contribution rate to a fixed contribution rate, as was the system prior to 2022. This change has resulted in judges putting more of their salaries into their pension, further driving down net pay for judicial officers.

    In the finalized appropriations bill, the retirement system remains on a variable contribution rate, but makes changes to create a 35%-65% split between contributions from judges, in addition to setting a 1% limit on how much contribution rates can vary from the prior year’s rate.

    Lohse said “sometimes it’s not what we do, but also what we do not do that is just as important.” 

    Rep. Eric Gjerde, D-Cedar Rapids, praised the legislation.

    “Judiciary spoke very loudly and clearly to us and told us what they need,” Gjerde said, adding that the retirement system and pay raise provisions address these concerns.

    Not included in the legislation is a measure from the original Senate Judicial Branch appropriations proposal changing the make-up of the judicial nominating commission that nominates district court judges. The proposal would have given the governor the power to appoint six of the commission’s 11 members.

    Another measure stripped from original proposals was a pay raise for jurors. The House proposed increasing pay for jury duty from $30 to $50 per day to $75 to $95 per day.

    “That is something that we desperately do need to do,” Lohse said. “However, unfortunately, it was a casualty of the budgeting process. And I hope next year we’re able to bring that forward.”

    The bill passed 90-1, with Rep. Jeff Shipley voting against. It moves to the governor for approval.

    Justice system: House File 2693 appropriates $712.8 million to the state’s justice system, a roughly $24 million increase from the previous year.

    Lohse said one of the biggest questions related to the justice system’s costs is the potential loss of funding through the federal Victims of Crime Act, or VOCA. Iowa currently receives more than $5 million annually through VOCA, funds that go to services for victims of human trafficking, sexual assault, domestic violence, and violent crimes.

    Congress is considering cutting VOCA funds by more than 40% for the 2024 fiscal year, which would put a significant portion of funding for these services in Iowa at risk. The Des Moines Register reported in February that Iowa victims’ rights advocates as well as state officials like Iowa Attorney General Brenna Bird are calling on federal lawmakers to reject these changes to VOCA or to provide short-term funding solutions to ensure that victim support agencies can continue to provide services.

    Current VOCA funding will continue through the federal fiscal year through Sept. 30, 2024, Lohse said. But past that point, funding for these services could be reduced. Lohse said Bird and various Iowa organizations, working with the federal government and Iowa’s congressional delegation, have identified potential funds that could go to replenish VOCA, but that change is still contingent on congressional action.

    “It’s our intention that if the federal government doesn’t come through, that we will provide emergency funding as quickly as possible when we convene next January,” Lohse said. “So I hate to say it’s a ‘wait and see what happens,’ but that, at this point, is where we’re at. And we’re very hopeful the federal government will come through and replace the funding that they had promised.”

    The bill also includes some pay raises, increasing correctional workers’ starting pay and minimum pay to $24 per hour, and increasing the pay rate for indigent defense rates for attorneys by $3 per hour across the state.

    The bill also includes an increase of $2.8 million for the Attorney General’s office, which includes funding for six new employees – three attorneys, two investigators and one paralegal, that will assist county attorneys with investigating and prosecuting crimes.

    Petersen introduced an amendment during Senate debate requiring the Attorney General’s office to reinstate its policy of paying for emergency contraceptives and other health care services for sexual assault victims. The amendment comes following criticism by Iowa Auditor Rob Sand and legislative Democrats for Bird’s decision to pause payments for the Sexual Assault Examination Payment Program as part of a “full audit of victim services” that she announced shortly after taking office in January 2023.

    Under longtime Attorney General Tom Miller, a Democrat, the office paid for these services, including medicine like Plan B as well as procedures like abortion, for sexual assault survivors using money from the state’s victim compensation fund.

    “Iowans who are raped or sexually assaulted should not be revictimized by the attorney general denying them medical care that they need,” Petersen said, asking for support of the measure.

    But Sen. Julian Garrett, R-Indianola, said the amendment was “unusual” as it would put conditions on the attorney general’s ability to access funding contingent on reinstating the program – “not something we would ordinarily do.” The proposal failed in a 15-32 vote.

    Brooklyn Draisley contributed to this report.

    The post Iowa lawmakers pass income tax cut, budget bills in push to end session appeared first on Iowa Capital Dispatch.

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  • Biden uses new speech to argue Trump’s tax plans are a political liability

    Biden uses new speech to argue Trump’s tax plans are a political liability

    Donald Trump’s tax plans have already proven to be a hit with billionaires. Joe Biden is hoping that those same plans will be politically toxic in the states that will decide the election this fall.

    That calculation was a central theme of a campaign speech Biden delivered Tuesday in the key swing state of Pennsylvania.

    “He looks at the economy from Mar-a-Lago where he and his rich friends embrace trickle-down policies that have failed the working class for more than 40 years,” Biden said of Trump in the speech that was billed as a major address. Under a banner about tax fairness, Biden then added “Donald Trump embodies that failure.”

    The emerging case from Biden and his campaign is that another round of Trump tax cuts for the richest Americans and corporations would explode the federal deficit even further — $5 trillion over 10 years by team Biden’s estimates.

    The plans, they say, would also exacerbate inflation and be a campaign liability among voters angry that the richest Americans and corporate America aren’t paying their fair share.

    “It’s indefensible on fairness grounds, but it’s also bad economics,” said Brian Deese, the former director of Biden’s National Economic Council, added as part of a campaign preview offered to reporters that focused almost entirely on Trump’s tax policies over Biden’s.

    US President Joe Biden boards Air Force One at Joint Base Andrews in Maryland on April 12, 2024 as he departs for Rehoboth, Delaware, where he will spend the weekend. (Photo by Mandel NGAN / AFP) (Photo by MANDEL NGAN/AFP via Getty Images)

    President Joe Biden boards Air Force One on April 12 as he departs for Rehoboth, Delaware. (MANDEL NGAN/AFP via Getty Images) (MANDEL NGAN via Getty Images)

    The speech in Scranton, Biden’s hometown, was the kick off of a three-day swing through Pennsylvania, with the president set to appear in Pittsburgh and Philadelphia in coming days in a series of events where aides promise he will keep delivering his tax message.

    The campaign swing also include a stark split-screen with Trump, who is spending this week in a Manhattan courtroom as he faces criminal charges stemming from a hush-money case. Jury selection continued on Tuesday in that trial.

    Biden aides link together the three issues of abortion, defending democracy, and what they describe as “tax giveaways to the very wealthy at the expense of the middle class” which they says will deliver them a win in November.

    What remains to be seen is whether voters agree. Biden still faces low approval ratings, and although polls have recently shown him closing the gap, he is still trailing Trump in key swing states.

    A recent survey from The New York Times and Siena College, as one example, found President Biden nearly erasing Trump’s recent polling advantage as both sides prepared for a tight race.

    Contrasting policies

    While the political effect of tax policy remains to be seen, Biden and Trump will offer voters a clear choice on the issue this fall.

    This year’s campaign comes ahead of a 2025 that is set to be consumed by tax issues. Trump’s tax cuts — formally called the Tax Cuts and Jobs Act of 2017 — include an array of provisions that expire at the end of 2025.

    Much of that bill was focused on individual tax rates, and that issue will be front and center on the next president’s desk.

    Trump’s plan is to extend or make permanent these tax cuts. His policy would benefit many Americans, but most of the spoils would go to the richest.

    Read more: 3 ways retirees can save on taxes

    Biden has said he would allow the tax cuts to expire (effectively a tax hike) for households earning more than $400,000 but would leave the lower rates in place for everybody below that threshold.

    Corporate taxes are set to be another key debate, with Biden recently offering a budget that would raise the statutory rate from 21% to 28%. Trump wants it cut to 15%.

    Former U.S. President Donald Trump sits inside a Manhattan criminal court in New York, on Monday, April 15, 2024. The hush money trial of former President Trump begins Monday with jury selection. It's a singular moment for American history as the first criminal trial of a former U.S. commander in chief. (Jeenah Moon/Pool Photo via AP)Former U.S. President Donald Trump sits inside a Manhattan criminal court in New York, on Monday, April 15, 2024. The hush money trial of former President Trump begins Monday with jury selection. It's a singular moment for American history as the first criminal trial of a former U.S. commander in chief. (Jeenah Moon/Pool Photo via AP)

    Former. President Donald Trump sits inside a Manhattan criminal court on April 15. (Jeenah Moon/Pool Photo via AP) (ASSOCIATED PRESS)

    Trump’s case is that cuts would unleash economic growth and supercharge the economy, while Biden is hoping voter anger over tax cuts for rich people and booming corporate profits will be a top issue for voters and rebound to his benefit.

    The president and his allies appear to be making some headway, with a Financial Times-Michigan Ross poll finding a growing 63% of survey respondents willing to blame price increases on “large corporations taking advantage.”

    Biden’s focus on taxes on Tuesday spanned multiple issues, including both the 2017 cuts as well as Trump’s plans to repeal high-income tax provisions in the Affordable Care Act.

    “Trump wants to renew another round of billionaire tax breaks and corporate giveaways,” Biden said in his speech adding “this is ridiculous what’s going on now.”

    The contrast, Biden added, will be with his tax plans that the president cast as being focused on about encouraging growth across the overall economy — specifically in the manufacturing sector — and making rich Americans pay more.

    Trump’s approach

    Trump has largely been focused on his legal troubles recently but still finds time to regularly tout his approach to taxes and is even floating billionaire financiers who might serve in his Cabinet.

    On the campaign trail, he promises a return to the policies he championed in office, calculating voters will respond positively.

    “In my first term, we built the greatest economy in the history of the world: We had record tax cuts and regulation cuts and rising wages,” he said at a recent rally in Wisconsin.

    The focus on cuts has also clearly struck a chord with at least some of the wealthiest Americans. A recent Trump fundraiser in Florida was populated by billionaires and — Trump’s campaign says — raised $50.5 million in a single night.

    “It’s clearer than ever that we have the message, the operation, and the money to propel President Trump to victory on Nov. 5,” Trump campaign senior advisers Chris LaCivita and Susie Wiles said in a recent statement around that fundraiser and how they view the election playing out.

    This post has been updated.

    Ben Werschkul is Washington correspondent for Yahoo Finance.

    Click here for politics news related to business and money

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  • Biden hopes to make Trump’s tax plans into a political liability

    Biden hopes to make Trump’s tax plans into a political liability

    Donald Trump’s tax plans have already proven to be a hit with billionaires. Joe Biden is hoping that those same plans will be politically toxic in the swing states that will decide the election this fall.

    That calculation is set to be a central theme of a speech Biden is set to give in the key swing state of Pennsylvania later today at 2:00 p.m. ET. Biden’s campaign is billing it as a “major address.”

    “It’s indefensible on fairness grounds, but it’s also bad economics,” said Brian Deese, the former director of Biden’s National Economic Council, as part of a campaign preview offered to reporters that focused almost entirely on Trump’s tax policies over Biden’s.

    The emerging Biden case is that another round of Trump tax cuts would explode the federal deficit even further — $5 trillion over 10 years by team Biden’s estimates.

    The plans, they say, would also exacerbate inflation and be a campaign liability among voters angry that the richest Americans and corporate America aren’t paying their fair share.

    US President Joe Biden boards Air Force One at Joint Base Andrews in Maryland on April 12, 2024 as he departs for Rehoboth, Delaware, where he will spend the weekend. (Photo by Mandel NGAN / AFP) (Photo by MANDEL NGAN/AFP via Getty Images)

    President Joe Biden boards Air Force One on April 12 as he departs for Rehoboth, Delaware. (MANDEL NGAN/AFP via Getty Images) (MANDEL NGAN via Getty Images)

    The speech today in Scranton, Biden’s hometown, will kick off a three-day swing through Pennsylvania, with the president also set to appear in Pittsburgh and Philadelphia in a series of events where aides promise he will keep delivering his tax message.

    The coming campaign swing will also include a stark split-screen with Trump, who is spending this week in a Manhattan courtroom as he faces criminal charges stemming from a hush-money case.

    “Trump is running on a losing message for Pennsylvanians,” Biden-Harris battleground states director Dan Kanninen added during this week’s preview.

    The aide linked together the three issues of abortion, defending democracy, and “pushing for tax giveaways to the very wealthy at the expense of the middle class” that he says will deliver them a win in November.

    What remains to be seen is whether voters agree. Biden still faces low approval ratings, and although polls have recently shown him closing the gap, he is still trailing Trump in key swing states.

    A recent survey from The New York Times and Siena College, as one example, found President Biden nearly erasing Trump’s recent polling advantage as both sides prepared for a tight race.

    Contrasting policies

    While the political effect of tax policy remains to be seen, Biden and Trump will offer voters a clear choice on the issue this fall.

    This year’s campaign comes ahead of a 2025 that is set to be consumed by tax issues. Trump’s tax cuts — formally called the Tax Cuts and Jobs Act of 2017 — include an array of provisions that expire at the end of 2025.

    Much of that bill was focused on individual tax rates, and that issue will be front and center on the next president’s desk.

    Trump’s plan is to extend or make permanent these tax cuts. His policy would benefit many Americans, but most of the spoils would go to the richest.

    Read more: 3 ways retirees can save on taxes

    Biden has said he would allow the tax cuts to expire (effectively a tax hike) for households earning more than $400,000 but would leave the lower rates in place for everybody below that threshold.

    Corporate taxes are set to be another key debate, with Biden recently offering a budget that would raise the statutory rate from 21% to 28%. Trump wants it cut to 15%.

    Former U.S. President Donald Trump sits inside a Manhattan criminal court in New York, on Monday, April 15, 2024. The hush money trial of former President Trump begins Monday with jury selection. It's a singular moment for American history as the first criminal trial of a former U.S. commander in chief. (Jeenah Moon/Pool Photo via AP)Former U.S. President Donald Trump sits inside a Manhattan criminal court in New York, on Monday, April 15, 2024. The hush money trial of former President Trump begins Monday with jury selection. It's a singular moment for American history as the first criminal trial of a former U.S. commander in chief. (Jeenah Moon/Pool Photo via AP)

    Former. President Donald Trump sits inside a Manhattan criminal court on April 15. (Jeenah Moon/Pool Photo via AP) (ASSOCIATED PRESS)

    Trump’s case is that cuts would unleash economic growth and supercharge the economy, while Biden is hoping voter anger over tax cuts for rich people and booming corporate profits will be a top issue for voters and rebound to his benefit.

    The president and his allies appear to be making some headway, with a Financial Times-Michigan Ross poll finding a growing 63% of survey respondents willing to blame price increases on “large corporations taking advantage.”

    Biden’s aides previewed his message this week as spanning multiple issues, including Trump’s plans to repeal high-income tax provisions in the Affordable Care Act. Deese said, “The magnitude of the windfall for those highest-income Americans is striking.”

    The contrast, he added, will be with Biden’s tax plans that the president will cast today as being about encouraging growth across the overall economy — specifically in the manufacturing sector — and making rich Americans pay more.

    Trump’s approach

    Trump has largely been focused on his legal troubles recently but still finds time to regularly tout his approach to taxes and is even floating billionaire financiers who might serve in his Cabinet.

    On the campaign trail, he promises a return to the policies he championed in office, calculating voters will respond positively.

    “In my first term, we built the greatest economy in the history of the world: We had record tax cuts and regulation cuts and rising wages,” he said at a recent rally in Wisconsin.

    The focus on cuts has also clearly struck a chord with at least some of the wealthiest Americans. A recent Trump fundraiser in Florida was populated by billionaires and — Trump’s campaign says — raised $50.5 million in a single night.

    “It’s clearer than ever that we have the message, the operation, and the money to propel President Trump to victory on Nov. 5,” Trump campaign senior advisers Chris LaCivita and Susie Wiles said in a recent statement around that fundraiser and how they view the election playing out.

    Ben Werschkul is Washington correspondent for Yahoo Finance.

    Click here for politics news related to business and money

    Read the latest financial and business news from Yahoo Finance

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