Congress is known for its partisan rancor and the death of bills that attract public attention. However, there are successful compromises that happen all the time without much fuss. One such example is the bipartisan tax deal passed by the House of Representatives with an overwhelming margin of 357-70 on January 31st. The $78bn package aims to trade more generous tax credits for families with children for more generous tax credits for businesses, completely paid for by eliminating a tax credit for a covid-era relief program that was abused by fraudsters.
If the bill becomes law, it would bring significant benefits to both capital and labor, allowing businesses to immediately deduct research and development costs and more aggressively deduct capital and interest expenses. The revision of the child-tax credit would ensure that families at the bottom of the income distribution receive greater sums. This tax deal is a sensible and noteworthy achievement that deserves attention.
2024-02-08 09:40:12
Article from www.economist.com