Become informed in minutes...

U.S. Senate Republicans were continuing their efforts early this morning to pass President Donald Trump's sweeping tax-cut and spending bill, amid deep divisions within the party about its expected $3.3tn hit to the nation's debt pile. Voting on amendments and procedural motions started midmorning Monday and dragged through the night as Republican leaders worked to find a balance of policies that could pass both the Senate and later the House. Mr. Trump spoke with congressional leaders by phone, and the White House said it was confident that the bill was on track even as its fate and final content remained uncertain. Senate Majority Leader John Thune (R-SD) spoke privately with Sen. Lisa Murkowski (R-AK), after he and other party leaders had engaged in long discussions with her on the Senate floor regarding both the Medicaid and nutrition-assistance cuts in the bill and the phaseouts of clean-energy tax credits.

 

Accounting Today

Atlanta Journal-Constitution

Reuters

Wall Street Journal

Digital Transformation in Accounting: The Path Forward

“The Path Forward” demystifies what it truly means to become a digital-first firm, helping accountants of all types embrace technology, boost operational efficiency, and strengthen client relationships in an increasingly automated world.

Get the Guide >>

 

Sens. Elizabeth Warren (D-MA), Ron Wyden (D-OR), and others are questioning ConocoPhillips and Ovintiv Inc. regarding their lobbying efforts for a $1.1bn tax loophole in the Senate's reconciliation bill. This loophole, if enacted, would exempt "intangible drilling and development costs" from the corporate alternative minimum tax (CAMT), potentially allowing these companies to pay no federal income taxes. The Inflation Reduction Act of 2022 aimed to ensure that corporations with over $1bn in profits pay at least 15% in taxes, but lobbying efforts have sought to weaken this requirement. The senators argue that this tax break would cost American taxpayers over $1bn in the next decade and lead to higher energy costs for consumers. They emphasize that Congress should not raise energy prices for families to benefit Big Oil.

 

Tax Notes

The Senate is poised to vote on a Republican bill that would eliminate tax credits for clean energy, imposing new taxes on wind and solar projects while promoting coal production. Sen. Ron Wyden (D-OR) criticized the plan, stating it is “a death sentence for America's wind and solar industries,” and warning it could lead to increased utility bills and jeopardize renewable energy projects. The bill aims to cut “hundreds of billions of dollars” from the Green New Deal, according to Senate Finance Committee Chair Mike Crapo (R-ID), who claims it will save taxpayers money. However, environmental advocates, including Mattea Mrkusic from Evergreen Action, argue that the legislation will “lock in higher household energy bills” and harm job growth in the clean energy sector. Princeton Professor Jesse D. Jenkins expressed disbelief at the bill's aggressive timeline for ending clean energy incentives, calling it “insanity.”

 

US News and World Report

Vermont Gov. Phil Scott has enacted a law that introduces significant tax benefits for residents, particularly caregivers. The law establishes a refundable unpaid caregiver tax credit of up to $1,000 annually for those providing at least 20 hours of care weekly to individuals with disabilities or health conditions. Additionally, it expands eligibility for existing child tax credits and the Earned Income Tax Credit (EITC) to individuals without taxpayer identification numbers. The law also raises income limits for excluding social security and retirement income from taxable income.

 

Bloomberg Tax

Recent federal and state developments are enhancing the appeal of Research and Development tax credits, which have traditionally been associated with tech firms. CFOs are encouraged to view these credits not just as tax breaks but as vital cash flow strategies for innovation. The R&D tax credit offers a dollar-for-dollar reduction in tax liability for qualifying activities, which now include a broader range of industries. Federal credits can range from 6% to 10% of qualified expenses, with additional state credits available. Notably, Texas has made its R&D tax credit permanent, reflecting a growing trend among states to support innovation incentives.

 

CFO

MNI Indicators reported on Monday that its Chicago Business Barometer inched down to 40.4 in June, from 40.5 in May, remaining below the 50 mark separating expansion from contraction. The production index dropped 2.7 points to its lowest level since July; the supplier deliveries gauge was down 6,8 points, and the employment index by 3.9 points. However, the new orders index rose 4.1 points. 

 

RTT News

Boeing has appointed former Lockheed Martin executive Jesus 'Jay' Malave as its new chief financial officer, effective August 15th, when he will replace Brian West, who is to remain as an advisor to chief executive Kelly Ortberg. Mr. Malave takes the role "at an important time in helping build Boeing’s next chapter,” Mr. Ortberg said. “He is a well-respected financial and business leader, and brings decades of experience developing people and teams across complex aerospace and manufacturing businesses.” Mr. Ortberg has been shaking up Boeing’s management since arriving at Boeing in August. Defense chief Ted Colbert left last year shortly after Mr. Ortberg’s arrival. Boeing’s quality chief, its chief information officer and its top lobbyist have also departed the company. 

 

Financial Times

Reuters

The Seattle Times

Wall Street Journal

The U.S. Supreme Court has decided not to review a case regarding the tax exemption status of a privately owned power plant on tribal land, effectively upholding previous rulings from Arizona's courts. These rulings indicate that federal law does not prevent state and local taxes on properties not owned by Native Americans. The affiliate of South Point Energy Center LLC, which leases land from the Fort Mojave Indian Tribe, had sought a refund exceeding $20m in property taxes.

 

Bloomberg Tax

Standard Chartered Bank is facing a $2.7bn lawsuit over its alleged role in enabling fraud.  Liquidators who are seeking to recoup misappropriated funds from Malaysia's sovereign wealth fund 1MDB have filed legal proceedings in Singapore. Liquidators allege Standard Chartered Bank chose to overlook obvious red flags in relation to the transfer of funds, resulting in the losses. "According to this lawsuit, the transfers demonstrate serious breaches and control failings which ultimately enabled the theft of public funds by people operating at the highest levels of the Malaysian government during that period," they said.

 

Reuters

U.S. government officials have issued a warning that Iranian-affiliated hackers may target American companies and critical infrastructure, particularly those linked to Israeli defense firms. Although there is currently no evidence of a coordinated cyber campaign, agencies including the FBI and NSA are advising organizations to bolster their cybersecurity measures. The advisory highlights the potential for malicious cyber activity despite ongoing negotiations for a ceasefire, and notes that Iranian state-sponsored hackers often exploit vulnerabilities in outdated software and weak passwords.

 

Reuters

The U.S. and G7 nations have reached an agreement to prevent a global tax war by establishing a "side-by-side" system that exempts U.S. companies from certain aspects of an existing global tax framework. As part of this deal, U.S. officials removed Section 899, known as the "revenge tax," which would have raised taxes on U.S. income for non-U.S.-based businesses. U.S. Treasury Secretary Scott Bessent emphasized that the removal of this section was "crucial to this overall understanding" and essential for fostering a stable environment for discussions on global corporate taxation. The G7 also aims to address the taxation of the digital economy while preserving tax sovereignty for all countries.

 

CPA Practice Advisor

The U.S. Department of Justice (DOJ) and FBI have announced an arrest and indictments related to North Korea's "IT worker" program, which allowed North Koreans to secure remote IT jobs at over 100 U.S. companies. The North Koreans allegedly stole around $900,000 in cryptocurrency from a Georgia-based firm and sensitive data from a California defence contractor. Zhenxing “Danny” Wang and Kejia Wang, both U.S. citizens, were indicted as part of the operation, according to the DOJ. Zhenxing Wang was arrested in New Jersey, while Kejia Wang remains free. The two men, along with four other unnamed U.S. “facilitators,” assisted the North Koreans by procuring and operating laptops used by the overseas workers, created financial accounts to receive money earned by the workers to be sent back to North Korea, and created shell companies to make the workers appear more authentic, Reuters reports.

 

Fox News

Reuters