The Trump administration and U.S. Senate is working on a major economic stimulus package. So far, here’s what I’ve put on the table for discussion.
• Temporary deregulation: Require every agency to “scrub” their rules, and suspend significant regulations that will reduce costs for the economy, for the duration of the emergency.
• “Advance” on tax refunds: For people that do not meet the minimum income threshold for filing federal income taxes: An “advance” or pre-payment on fed tax refunds of $5,000—roughly equal to the average refund for the 2019 and 2020 tax years combined. This refund could gradually be recouped through the with-holding of future refunds or by setting recovery surcharge after emergency ends.
• Reduction of the pass-through tax rate: To help small businesses (likely to be hit hardest) of fifty or fewer employees, which make up a majority of businesses in most parts of the country.
• Modification of the net operating loss (NOL) assessment: The TCJA eliminated “carrybacks” and permitted unlimited “carryforwards” of NOLs instead. New policy could once again allow businesses to carryback to more profitable times, or, it could allow firms to draw down NOLs by making them refundable.
• Elimination of paid-leave mandates: Most small business owners are primarily concerned with preserving liquidity and guaranteeing their future solvency. Paid-leave mandates could inadvertently force some of these rattled small businesses to lay off workers permanently.
• Protection of industries from regulatory takings: Allow businesses forced to close or pare back operations (i.e. airline companies, restaurants) due to government mandates a reprieve from regulatory takings via temporary, interest-free loans provided through the Treasury Department.
• Expansion of tax deductions and/or credits for individuals who work from home: The coronavirus may spur more permanent changes in workforce behavior. In addition to expanding existing tax deductions for individuals who work from home, we could make deductions more flexible to account for any “gig” work that individuals may be forced to take on in the short-term.
• Expansion of tax deductions and/or credits for individuals who start a business: Some entrepreneurial individuals may see the current crisis as an opportunity to leave their current jobs entirely and start their own businesses.
• “Pause” or extension on foreclosures/evictions/repossessions for homeowners, business owners, and car owners: Underscore the words “pause” or “extension”. The Trump admin and some states are moving toward this. Federal law may help.
• Expansion of Health Savings Accounts: We should make it even easier for consumers to use pre-tax dollars on a wide range of services, including suspending the requirement that HSAs can only be used with a high deductible health plan, for at least the duration of the emergency.
• Reduction or elimination of FDA regulations on non-invasive medical devices: These reductions could be expanded to include DIY COVID-19 test kits.
• Clarification and codification of Trump administration efforts to ease telehealth restrictions: President Trump has already begun to lift restrictions for Medicare patients, but not for other populations. These additional restrictions could be lifted for the duration of the emergency.
• Waiving out-of-state medical licensing requirements: This reform is already happening slowly on a state-by-state level, but could be mandated, for the duration of the emergency, at the federal level.