Revised Cost-of-Living Adjustment: The IRS and Treasury revised Notice 2017-64 providing a listing of dollar limitations applicable to qualified retirement plans as adjusted for cost-of-living adjustments for 2018, to reflect the Bureau of Labor Statistics’ adjustment to CPI-U for July and August 2016. The change affects the factor for adjusting a participant’s high-3 compensation limitation under section 415(b)(1)(B).
CEA Releases Additional Tax Reform Report: The White House Council of Economic Advisers (CEA) has released a second report regarding the administration’s views on the impact of corporate tax reform. The report restates the conclusion of an earlier report that a reduction in the statutory federal corporate tax rate from 35 to 20 percent and the introduction of immediate full expensing of non-structure investments will raise the average household’s wage income by $4,000. In this report, the calculation is based on the CEA’s conclusion that these reforms will increase GDP by 3 to 5 percent by 2027. The CEA also concludes that workers will receive between 50% and 70% of such increased income as a result of their ability to “bargain over the increased profits” of businesses and of increased worker productivity due to the existence of more capital per worker.
In general, economists have not reached consensus as to the magnitude of increased economic activity caused by tax cuts or the portion of the economic burden of corporate taxes that is ultimately borne by workers.
European Commission Releases Regulations Regarding Automatic Exchange of Information: The European Commission released regulations regarding the yearly assessment of the effectiveness of the automatic exchange of information and the statistical data to be provided by Member States.