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Trump and Johnson Reject Proposal to Raise Taxes on Wealthy: On April 23, House Speaker Mike Johnson (R-LA) publicly stated his opposition to creating a new, higher marginal income tax rate on the most affluent taxpayers, an idea that has been floated in some Republican circles as a potential revenue raiser for the budget reconciliation package. Speaker Johnson said that he is “not in favor of raising the tax rates because our party is the group that stands against that traditionally.” President Trump also expressed skepticism over the political viability of the proposal, stating that while he likes the idea “in concept,” he said that it would likely lead wealthy taxpayers to leave the country.
EU Considering Changing Minimum Corporate Tax Law: On April 29, European Union (EU) officials met to discuss several policy options to potentially modify the EU’s 15% global minimum tax law, known as the Minimum Tax Directive, as well as the undertaxed profits rule (UTPR) that allows countries to levy top-up taxes to ensure a multinational business’ effective tax rate is at least 15%. Currently, a safe harbor is in place, exempting non-EU companies from being taxed in countries with a statutory corporate tax rate above 20% until the end of 2026. The UTPR has been the centerpiece of grievances the United States has had about global minimum tax laws, as many large U.S. companies are multinational corporations and could lose billions of dollars in revenue under the law.
Italy Joins United States in Opposing DSTs: Following Italian Prime Minister Giorgia Meloni’s visit to the White House on April 18, the prime minister and President Trump issued a joint statement calling for “a non-discriminatory environment in terms of digital services taxation” in order to “enable investments from cutting-edge tech companies.” Currently, Italy applies a 3% digital services tax (DST) on internet transactions for tech companies with sales of at least 750 million Euros (about $855 million). Italy’s executive leadership has had mixed views on whether to abandon the nation’s DST, as U.S. pressure to abandon DSTs contends with pressure from the European Union (EU) to retain them, as well as domestic concerns about the country’s public finance in the absence of a DST. After the visit, Italian Economy Minister Giancarlo Giorgetti called for DST negotiation with the United States to be conducted bilaterally rather than through the EU.
Key Democrats Call for Investigation of Donations to IRS Commissioner Nominee: According to Federal Election Commission (FEC) Q1 2025 filings, former Congressman Billy Long (R-MO), currently the nominee-designate to be the commissioner of the Internal Revenue Service (IRS), received $137,000 in donations to his 2022 U.S. Senate campaign account, despite not having announced that he is running for political office since his loss in the 2022 Missouri Senate Republican primary. Long reportedly used the donations to repay $130,000 in personal loans made to his campaign. Many of the donors listed in the FEC filing reportedly are listed as employees of several tax and financial advising companies Long worked with or had ties to, including White River Energy Corp. and Lifetime Advisors. These companies have allegedly promoted so-called “Native American Federal Income Tax Credits” or “Sovereign Tribal Tax Credits,” which the IRS has confirmed do not exist. On April 15, Senate Finance Committee Ranking Member Ron Wyden (D-OR) and Sen. Catherine Cortez Masto (D-NV) sent a letter to then-Acting IRS Commissioner Melanie Krause calling on the IRS to open a criminal investigation of promoters of these “Tribal” tax credits, whether Long was personally and financially involved in the promotion of the credits, and whether his confirmation as IRS commissioner could undermine criminal enforcement efforts against companies he was formerly involved with. In addition, Sen. Cortez Masto called for the withdrawal of Long’s nomination via a post on social media platform X on April 17. At present, a confirmation hearing for Long in the Senate Finance Committee has not been set.
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