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PwC is to become the largest customer and first reseller of OpenAI's enterprise product. ChatGPT Enterprise is to be made available to the Big Four firm's 75,000 U.S. employees and 26,000 U.K. employees, in what Joe Atkinson, PwC U.S.’s vice chair and chief products and technology officer, called an evolution of its existing $1bn investment in generative artificial intelligence (AI). Financial terms of the deal have not been disclosed. PwC sees using ChatGPT Enterprise as a way to test and apply the technology internally before passing on firsthand learnings to clients. So far, 95% of PwC’s U.S. workforce has spent over 360,000 hours on generative AI activities and learning, it said. “This is more of an assistant that’s available to you than it is a search bar,” Mr. Atkinson said. 

 

Reuters

Wall Street Journal

Intuit shares dropped the most in two years on Friday, after the company reported losing 1m customers who use its TurboTax service for free, stoking concerns about demand for the software. Despite the loss in free customers, there are signs that Intuit's investments are paying off. The average user of TurboTax is spending 10% more on their filing this year compared with a year ago, according to the company. Fiscal third-quarter revenue increased 12% to $6.74bn, surpassing the $6.64bn average of analysts' estimates. Chief executive Sasan Goodarzi shrugged off the importance of the free customer base. Some people are "just really looking for a free tax software — bouncing between platforms — and we are not interested in pursuing those customers," he said. Goodarzi also highlighted that TurboTax gained share among people who traditionally have hired an accountant to handle their tax returns.

 

Accounting Today

KPMG Canada has appointed Benjie Thomas as chief executive officer, effective October 1st. He succeeds Elio Luongo, who is near the end of his second four-year term, an eight-year tenure that saw the launch of KPMG’s Truth and Reconciliation Action Plan and its Disability Inclusion Action Plan. Mr. Thomas has been at KPMG Canada since 1998; he has served as managing partner of the advisory practice since 2016 and industry leader for private equity and pension funds since 2006. 

 

Consulting

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An IRS whistleblower has accused the agency of failing to police a tax break in Puerto Rico used by wealthy Americans to cut their tax bills to zero. In 2012, legislation was enacted permitting new residents to avoid local taxes on their investment income while they reside on the island. To be eligible for the tax break, residents need to apply to the Puerto Rican economic development agency, which publicly discloses their identities. The number of registrants has nearly quadrupled over the past five years, to more than 5,000. According to a letter written by an IRS insider, the agency's three-year campaign to uncover abuse of a tax benefit has failed to make much headway. Fewer than 1% of beneficiaries have been audited, yielding no taxes, the whistleblower said. "This is completely absurd in light of the amount of tax dollars at issue," the insider wrote. IRS Commissioner Danny Werfel acknowledged that no "soft letters" were sent, but highlighted the dozens that have been audited. He also said that the campaign was still in an early phase. "We're still coming out of our period of underinvestment, and we are still building muscle that atrophied,"  he added.

 

Business Insider

New York Times

The IRS has reminded taxpayers living and working outside the U.S. to file their 2023 federal income tax return by June 17th. This deadline applies to both U.S. citizens and resident aliens abroad, including those with dual citizenship. Taxpayers who qualify for the June 17th extension include U.S. citizens or resident aliens residing overseas or on duty in the military outside the U.S. To use the automatic two-month extension, taxpayers must attach a statement to their tax return explaining their situation. Additional extensions are available for taxpayers who can't meet the June 17th due date. The IRS encourages anyone needing additional time to file an extension electronically.

 

Bloomberg Tax

Tax Notes

Home prices in the 20 biggest U.S. metros hit another all-time high, as the housing market remains hampered by a low number of properties for sale. The S&P CoreLogic Case-Shiller U.S. National Home Price Index, a measure of home prices across the country, jumped 6.5% in March from a year earlier to a record high. It rose 0.3% from February. It is the sixth time the index has reached a new record high over the past year. The 20-city index rose 7.4%, just ahead of the 7.3% rise expected by economists surveyed by Dow Jones and the Wall Street Journal. A separate report from the Federal Housing Finance Agency also showed home prices rose 0.1% in March from the previous month, and were up 6.7% in the past year. The median price of a resale home was $392,900 in March, and a newly built home was $439,500. “We continue to see home prices push higher in most markets despite elevated mortgage rates and the rising cost of homeownership in general,” Selma Hepp, chief economist at CoreLogic, said in a statement. “Nevertheless, home price gains are driven by markets with strong employment centers and affordability opportunities, while markets with more for-sale inventories are seeing slower rates of home price appreciation.”

 

CNN

US News and World Report

Market Watch

A study from the Federal Reserve Bank of San Francisco suggests that extreme heat is set to stifle the U.S. economy by limiting construction workers' productivity and reducing capital investment. The construction sector, due to its significant contribution to economic output and substantial share of outdoor workers, is likely to determine the overall vulnerability of U.S. production to extreme heat. The study projects a substantial rise in outdoor workers' vulnerability to heat stress by the end of the century. The authors highlight that extreme heat would lower the capital stock, or the value of accumulated investment, by about 1.4% in 2100 and by 5.4% in 2200, reducing the economy's ability to produce output and annual consumption. However, the study also acknowledges that companies and employees could find ways to adapt, such as relocating production to cooler parts of the country or working during cooler parts of the day.

 

Bloomberg

U.S. consumer confidence unexpectedly improved in May, rising to 102.0 from 97.5 in April, according to The Conference Board. The increase was driven by optimism about the labor market, with fewer respondents saying jobs were "hard to get". However, the overall confidence gauge remained within a relatively narrow range. Consumer inflation expectations for the next 12 months rose to 5.4%, from 5.3% in April.

 

Bloomberg

Reuters

Some of Wall Street's biggest private equity firms, including Blackstone, Carlyle Group and TPG, have disclosed they are in negotiations with the SEC over their employees’ use of banned communication channels. Under SEC rules, financial firms are required to preserve and monitor their employees’ written communications, which creates a paper trail for regulators to monitor and enforce compliance with federal laws.  Firms whose employees talk about business over prohibited mobile apps such as WhatsApp risk violating those rules if they don’t retain or monitor those messages. The private equity firms’ disclosures come as U.S. regulators have continued their crackdown on off-channel communications violations over the past few years. The SEC since December 2021 has filed charges against 60 firms and imposed more than $1.7bn in fines for failing to maintain and preserve electronic communications.

 

Wall Street Journal

The U.S. is eager to reach agreement on and sign a crucial part of the OECD-led international tax deal by the end of June amid a looming threat of digital services taxes. Treasury Secretary Janet Yellen's public callout to India and China to engage in the global tax talks was intentional to get the deal done, according to those following global tax negotiations. It's also an indication of the urgency the administration feels to sign an agreement before the U.S. presidential election overshadows discussions and there's a potential for the proliferation of digital services taxes. 

 

Bloomberg Tax

The European Commission is considering raising tariffs on cheap Chinese electric vehicles (EVs) entering the EU. Currently, the EU charges a 10% tariff on Chinese EV imports, but this is expected to increase significantly. The dilemma for Europe is whether to subsidize or tax these cheap imports. While cheaper Chinese EVs would help Europe decarbonize, they could also harm European car manufacturing regions. France has implemented a half-solution by limiting purchase incentives to EVs with a production carbon footprint of less than 14.75 tonnes of CO2, excluding many Chinese-made EVs. The International Energy Agency predicts that the price of EVs will reach parity with traditional vehicles in Europe by 2025-2028. However, European car drivers will face carbon taxes and an internal combustion engine ban by 2035. Despite these challenges, maintaining EV subsidies may be wise. Several key transport files await lawmakers in September, including proposed laws to manage the contradiction of a common European travel area governed at a national level.

 

EurActiv.com