Tax reform

Smaller tax refunds in 2019 could slash U.S. auto sales

Cars at a Chevy dealership in Illinois. Photo: John Gress/Corbis via Getty Images

Last year's tax reform spurred stronger-than-expected car sales by giving consumers more disposable income, but the payback will come this spring when many Americans could discover they're not getting the tax refund they had expected.

Why it matters: Car sales are a key driver of the U.S. economy, and the industry sees a big uptick every spring as consumers turn their tax refund into a deposit on a new or used car. Without that seasonal bounce, 2019 auto sales may be lower, making a recession more likely.

5 states are facing budget shortfalls after Trump’s tax cuts

New York's state capitol building
New York's state capitol building. Photo: John Greim/LightRocket via Getty Images

Most states have shown strong revenue performances throughout fiscal year 2019, but five states — Idaho, Maine, Missouri, New York and North Carolina — are experiencing shortfalls, according to a report from the National Association of State Budget Offices.

Why it matters: Those five states' underperformance is in part a reaction to 2017 GOP tax cuts. The states, like most others, are still assessing how the cuts affect them, and are making increases or decreases to their revenue collection forecasts for fiscal year 2019 accordingly.

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