If Congress can’t cut a deal to avoid the sequester cuts before March 1, 300,000 jobs will be affected nationwide, costing state economies a combined $15 million from cuts to defense alone, according to ARMY documents obtained by USA TODAY. The report accounts for civilian furloughs, as well as job losses from military construction, defense contractors and private sector jobs lost due to reduced military investments. - Read more at The USA TODAY.
CALIFORNIA: THE GUINEA PIG OF TAX REFORM? Tax experts are watching California closely to see if the Golden State’s new tax increases will make or break its economy. On top of the federal tax hikes that kicked in last month as part of the fiscal cliff deal, California raised income taxes on its wealthiest residents even as its economy is in the midst of a turnaround. Other states will assess whether California’s new tax laws allow the state’s economy to continue growing – or cause a slowdown and send the state back into the red. - Read more at The Washington Post
GAS PRICES AND CONSUMER SPENDING After 32 consecutive days of rising gas prices, Americans are feeling some pain at the pump. For many, the return of the 2 percent payroll tax was enough of a setback. Now, with gas topping $4 a gallon in some areas, consumers are scrambling to pay the pump ... and the rest of their bills. - Read more at The Fiscal Times
WORKERS PAY FOR CORPORATE INCOME TAX? Bruce Bartlett, columnist for The Fiscal Times, writes in today’s New York Times that “most people assume that the corporate income tax is largely paid by consumers of its products or services… [But] corporations cannot raise prices to compensate for the corporate income tax because they will be undercut by businesses to which the tax does not apply… That leaves two remaining groups that may bear the burden of the corporate tax: workers and shareholders.” - Read more at The New York Times
EXECS GIVE UP ON TAX REFORM … FOR NOW Business executives don’t expect Congress to take up an overhaul of the business tax system this year and instead blame political gridlock and budget constraints, according to an annual survey. Most respondents said they don’t think tax overhaul will be enacted in 2013, and more than 40 percent predict that fundamental tax reform will not be enacted until after 2015, in contrast to 11 percent of those polled last year. - Read more at The Wall Street Journal