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TaxBuzz Top 5 - Sweden Draws International Criticism for Tax Change, Trump Suggests SALT Reversal & More

TaxBuzz Top 5 - Sweden Draws International Criticism for Tax Change, Trump Suggests SALT Reversal & More

Each Friday, TaxBuzz brings you the top five tax and accounting headlines you need to know from the workweek. We know life can get busy and you don't always have time to scroll through your news feed to stay informed.

We weed through all of the week's stories to showcase the most important updates in the tax and accounting world.

1. Harris County Approves 8% Property Tax Hike Amid Disaster Relief Exemptions

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Credit: Art Wager/Getty Images

Harris County, Texas, has approved an 8% property tax hike for 2024, bypassing the usual requirement for voter approval due to a state law exemption for disaster-affected areas. Under normal circumstances, any increase above 3.5% must be put to a public vote. However, because of multiple declared disasters in the region—including the May derecho storm and Hurricane Beryl in July—county leaders were able to implement the increase without a referendum.

Per KHOU 11 News, Harris County Judge Lina Hidalgo announced the decision during a Commissioners Court meeting. The increase means that homeowners in the county with properties valued at $400,000 will see an additional $160 in property taxes for the year. This hike is set to apply only for the 2024 tax year as the county continues to recover from recent disasters.

While the property tax increase aims to generate essential revenue for recovery and ongoing county services, it has sparked concern among residents already dealing with rising costs. The move highlights the balance county leaders must strike between funding essential services and minimizing the financial burden on homeowners.

This development could potentially trigger further debate about future tax hikes and disaster relief funding in the region.

2. Trump Signals Reversal on 2017 SALT Cap, Floating New Tax Cuts

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Credit: Alex Wong/Getty Images

Former President Donald Trump, known for championing tax cuts, is now suggesting he may reverse a key element of his 2017 Tax Cuts and Jobs Act (TCJA). In a post on Truth Social, Trump indicated that if re-elected, he would eliminate the $10,000 cap on state and local tax (SALT) deductions, a provision he previously backed during his presidency. The SALT deduction cap, which limits how much taxpayers can deduct for property and local taxes, has been a major point of contention, especially in high-tax states like New York and California.

Trump’s latest proposal to scrap the cap has been met with skepticism from both sides of the aisle, according to a CBS News report. Some lawmakers, like Democratic Rep. Tom Suozzi of New York, welcomed the idea, calling the SALT cap a "body blow" to their constituents. Others, however, questioned Trump’s newfound stance, including Senator Chuck Schumer, who accused Trump of trying to rewrite history for political gain.

Trump’s potential reversal on SALT comes as part of a broader plan to introduce more tax cuts, including eliminating taxes on Social Security benefits and overtime pay, aimed at appealing to middle-class voters and seniors ahead of the 2024 election.

The specifics of these proposals remain unclear, with Trump yet to outline the full details.

3. Swedish Government Scraps Flight Tax, Raising Emissions Concerns

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Credit: Sitikka/Getty Images

The Swedish government has drawn sharp criticism from international environmental groups after announcing its decision to scrap the flight tax, a measure designed to curb emissions from aviation. Introduced in 2018, the flight tax was part of Sweden's broader climate goals, coinciding with the rise of the "flygskam" (flight shame) movement led by activist Greta Thunberg.

In its 2024 budget, the center-right government, supported by the far-right Sweden Democrats, revealed plans to eliminate the tax starting July 2025. This change is expected to reduce ticket prices by 80 SEK (£5.93) for European flights and 325 SEK (£24.09) for long-haul destinations. However, the government acknowledged that the move would likely result in increased air travel and, consequently, higher emissions.

Environmental groups, including Greenpeace Sweden, strongly condemned the decision, noted The Guardian. Erika Bjureby from Greenpeace remarked, “The government is doing everything in its power to dismantle climate action.”

While the government insists that overall emissions will still be reduced through other budget measures, critics, such as the Swedish Green Party, accuse it of subsidizing polluting industries like aviation and diesel while cutting public transport funding. Denmark, in contrast, plans to introduce a flight tax in 2025 to fund the industry’s green transition.

4. Malaysia Announces Zero-Tax Incentives for Forest City to Boost Investment

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Credit: tang90246/Getty Images

In a move aimed at rejuvenating the beleaguered billion-dollar Forest City development in Johor, Malaysia has announced a series of tax incentives designed to attract high-level international investors, including family offices. These measures come as part of a broader initiative to establish a Special Financial Zone (SFZ) in Forest City.

During an event on September 20, Channel News Asia reports that Malaysia’s Second Finance Minister, Amir Hamzah Azizan, revealed that family offices operating in Forest City will benefit from a zero percent tax rate for 10 years on their revenue. This tax-free period can be extended if these offices scale up their investments in the Malaysian economy. To qualify, family offices must hold at least RM70 million (US$16.73 million) in assets, a lower threshold compared to neighboring countries, positioning Malaysia as a competitive option within Southeast Asia.

The government’s goal is to attract wealth management organizations by promoting Malaysia's robust infrastructure, skilled talent pool, and strong governance framework. The incentives are expected to be operational by early 2025, complementing efforts to integrate Forest City's SFZ with the Singapore-Johor Special Economic Zone.

By 2030, global family offices are projected to manage up to US$5.4 trillion in assets, offering significant opportunities for Malaysia to tap into this growing sector.

5. IRS Expands Direct Free File Program to Wisconsin in 2025

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Credit: HABesen/Getty Images

Beginning in 2025, Wisconsin residents will gain access to the IRS's free online tax filing program, Direct File, which aims to simplify the tax process and save millions in filing fees. The program, already tested in a 2024 pilot initiative, offers an alternative to costly tax preparation software programs, allowing taxpayers to file online for free.

The pilot program, which was available in 12 states, enabled 140,000 taxpayers with simple tax returns to file without using paid services. PBS Wisconsin notes that the IRS estimates that this pilot saved participants $5.6 million in fees. In 2025, more than 600,000 Wisconsin taxpayers will be eligible to use Direct File, significantly reducing the cost of tax preparation in the state.

Direct File's expansion comes amid ongoing resistance from the tax preparation industry. Companies like Intuit, the maker of TurboTax, have lobbied Congress to preserve their market share, with Intuit spending over $3.8 million in lobbying in 2023 alone. Despite industry opposition, the IRS continues to promote Direct File as a way to save taxpayers both time and money.

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Rebekah Barton

Rebekah Barton

Rebekah's search engine optimization career began completely by accident as a college student. Over the course of her career so far, she has "grown up" with the SEO industry, from writing content while juggling classes to managing her own teams of writers and overseeing SEO strategy in subsequent roles. She is excited to bring her passion for high-quality content to CountingWorks, Inc.

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