“Republicans buy sneakers too.” Michael Jordan, retired professional basketball player.
question:: W.Hat could We expect in the early stages of 2021 regarding Changes in taxes, climate Regulations, and consumer protection Dimensions With the new administration?
reply:: Before we start, I want to share a smart contribution from a friend Highlight the Irony of mandatory bySclaimer when talk about the future: “Merry Christmas from your lawyer: I wish you one reasonable Merry Christmas (or festive time), that is in no way guaranteed or limited to a reasonorous H.Appy new year (ie the twelve (12) months from the date hereof). “You got the idea, there are no guarantees and almost anything can change.
Acceptance of a peaceful change of power to the Biden Administration on the day of inauguration, January 20, 2021, the Biden administration‘s economically political outlook for the next year while very influenced of COVID-19, will emphasize the progress of theritage Priorities in the areas of energy and the environment, production, trade and consumer protection.
Policy changes are likely Be mitigated by the slim Democratic majority margins in the House and Senate, but democrats haveThe tools to adopt remarkable ones Tax and Expense Policy. In the near future, political uncertainty could help increased Financial market uncertainty and Volatility. L.longer term, the recovery support measures and a increases in federal spending are expected Continue supporting positive market sentiment.
The first 100 days and beyond
The democratic agenda is appropriate to start with aadditional fiscal incentives and confirmation of key people appointed by Biden. Later that year a Budget comparison calculation and Tax changes are they likely Focus. Q.questions and debate center on whether to become democrats Start with economic things that are believed to be a positive Market influence, In front Coping with tax and regulatory changes, This can possibly be viewed as a market negative. IIt is important not to underestimate how effective the Senate control will be in controlling the Senate agenda.
Budget and Taxes
With a tight majority and the need to get every senator on board before the crossing budget reconciliation and tax changesThis debate is likely to lead to false starts and breakdowns in the negotiations. However, since reconciliation is the only way for simple majority legislation to pass, we expect the Democrats to do whatever it takes to find a final Compromise. The question of how to pay increased spending on topics such as infrastructure, paid sick leave and childcare for tax increase conConsiderations. Biden’s tax plan is to raise the corporate tax rate to 28% and tighten the tax rules on foreign income.
There’s a lot of debate in DC over when expected possible tax changes. legislation is not may be retroactive, with the exception of tax law, which can be retroactive to January 1st of the previous year. Democrats would probably Take steps if you have the Opportunity but some changes ccould start in 2021.
The federal government can use executive power to modernize federal facilities to increase energy efficiency and take clean energy measures. Gina McCarthy is that White House climate coordinator and she was that former Obama EPA administrator. This sends a clear sign The Climate protection is a key priority for 2021.
It is expected that this will be a major focus in early 2021 a Consumer protection agenda. The authority of the Biden government in this area is in the Supreme Court rulingSeila Law against Consumer Financial Protection Bureau (CFPB) This gives the President immediate power to dismiss and replace the Director of the Bureau of Consumer Financial Protection at will. We believe this will be one of the earliest ways for the Biden government to show progressive lawmakers a focus on consumer protection.
Biden has largely avoided polarizing picks for regulators. However, there are still key positions without candidates. Democrats would have control over the setting of confirmatory votes and would ensure that many more of Biden’s picks receive a confirmatory vote. Senate rules still allow for delays in confirmation votes, which were effectively used by minority Democrats to slow down the confirmation process during the Trump administration.
In general, Biden’s previous cabinet decisions have signaled a prioritization of economic recovery and growth over a solid agenda for setting regulatory rules. However, a Biden government will have significant regulatory leverage – even before the candidates are approved by the Senate. Focus and plan accordingly.
There is no guarantee that any investment strategy will be successful. The opinions expressed are those of the writer of January 14th, 2021, but not necessarily those of Raymond James and Associates, and are subject to change at any time. The information contained in this report is obtained from sources believed to be reliable, but its accuracy cannot be guaranteed. Past performance does not guarantee future results. Every investor’s situation is unique and you should consider your investment goals, risk tolerance and time horizon before investing. Before making an investment decision, please contact your financial advisor about your individual situation.
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This article was written by Darcie Guerin, CFP®, Vice President, Investment & Branch Manager of Raymond James & Associates, Inc., a member of the New York Stock Exchange / SIPC 606 Bald Eagle Dr. Suite 401, Marco Island, FL 34145. She can be reached at (239) 389-1041 email darci[email protected]. Website: www.raymondjames.com/Darcie