Dems hold line on COVID-19 stimulus

Tax Hot Topics newsletter Congressional Democrats have indicated they are unlikely to return to the negotiating table on the next round of COVID-19 stimulus legislation until Republicans agree to compromise on overall spending.

Lawmakers remain far apart on the overall size of the package, with state and local funding making up much of the difference. House Speaker Nancy Pelosi (D-Calif.) recently suggested that Democrats have already met Republicans halfway, reducing their initial $3.2 trillion proposal to $2.2 trillion, and are unwilling to go further. The Trump administration and Senate Republicans have sought to limit the cost of the package to $1 trillion. Republicans have also pushed to separately address work on smaller packages for which there is agreement, but Democrats remain firmly opposed to a piecemeal approach. Negotiations have been stalled for weeks and the two sides appear no closer to an agreement than they were when Congress departed for its August recess.

There was some hope that stimulus could be paired with a must-pass spending bill, forcing lawmakers to resolve their differences before government funding expires on Sept. 30. However, Pelosi and Treasury Secretary Steven Mnuchin agreed to avoid a government shutdown on Friday, setting the stage for a clean continuing resolution that is likely to keep the government funded through the upcoming election.

Dustin Stamper
Managing Director
Washington National Tax Office
T  +1 202 861 4144

Omair Taher
Washington National Tax Office
T  +1 202 861 4143

Tax professional standards statement
This content supports Grant Thornton LLP’s marketing of professional services and is not written tax advice directed at the particular facts and circumstances of any person. If you are interested in the topics presented herein, we encourage you to contact us or an independent tax professional to discuss their potential application to your particular situation. Nothing herein shall be construed as imposing a limitation on any person from disclosing the tax treatment or tax structure of any matter addressed herein. To the extent this content may be considered to contain written tax advice, any written advice contained in, forwarded with or attached to this content is not intended by Grant Thornton LLP to be used, and cannot be used, by any person for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.

The information contained herein is general in nature and is based on authorities that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice provided by Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, the reader’s specific circumstances or needs and may require consideration of tax and nontax factors not described herein. Contact Grant Thornton LLP or other tax professionals prior to taking any action based upon this information. Changes in tax laws or other factors could affect, on a prospective or retroactive basis, the information contained herein; Grant Thornton LLP assumes no obligation to inform the reader of any such changes. All references to “Section,” “Sec.,” or “§” refer to the Internal Revenue Code of 1986, as amended.