For over 50 years, Bloomberg Tax’s renowned flagship daily news service, Daily Tax Report® has helped leading practitioners and policymakers stay on the cutting edge of taxation and...
By Casey Wooten
Jan. 14 — Work on an international tax code overhaul will begin this year, but whether Congress can pass a bill before 2017 remains unclear, House Ways and Means Chairman Kevin Brady (R-Texas) said.
“There's no guarantee an international tax proposal can or will make it to the president's desk, but it's very important that we advance it as far as we can in this year,” Brady told reporters during a Republican legislative retreat Jan. 14.
Republicans met at the Baltimore gathering to work out a legislative plan for the new year, where Brady said they laid the foundation for a “pro growth” legislative agenda in 2016 that includes an international overhaul bill, hearings on reworking other parts of the code and crafting a replacement to the Affordable Care Act.
“Fixing the tax code unifies us,” Brady said. “That was very clear from the session today.”
Brady said he and Senate Finance Committee Chairman Orrin Hatch (R-Utah) intend to begin working together during the week of Jan. 18 on a proposal, noting an urgency to take action on corporate inversions, which are deals where U.S. companies take a foreign address to cut their tax rates, and the need to bring corporate profits back to the U.S.
To address inversions, “you can wring your hands as a government, you can try very weak Treasury rules. The one consistent element has been an uncompetitive tax code that's driving this, so why don't we go to the root cause?,” Brady said.
Brady also said he'd like to act to bring home profits stranded overseas, although he acknowledged the difficulty of getting anything done this year.
Information on a time line to roll out legislation has been thin, and Republican leadership gave few guarantees that they would be able to advance major parts of their agenda. Brady's comments underscore the difficulty in crafting ambitious tax legislation during an election season and President Barack Obama's final year in office, despite the support of newly minted House Speaker Paul D. Ryan (R-Wis.).
Among those putting pressure on Brady and House leadership to move tax bills are conservative Republicans, who want a legislative agenda that includes votes to substantively revamp the tax code. Rep. Jim Jordan (R-Ohio), chairman of the House Freedom Caucus, has said that he will press leadership for a vote on a tax code overhaul soon.
Rep. Jeff Duncan (R-S.C.) told reporters that conservative Republicans were getting their message out at the retreat.
“They're being included, they're listened to, they're having their chance to be heard, and I think that's a positive,” Duncan said.
But political realities are never far away.
“A lot of people want to do something big and bold, but you know, trying to find the sweet spot is always a tough issue,” Rep. Devin Nunes (R-Calif.) told reporters at the retreat.
Nunes released his own comprehensive tax overhaul Jan. 13. Brady called the measure a “serious tax reform proposal” but didn't say when a hearing on the bill would take place (09 DTR G-4, 1/14/16).
Officials at the U.S. Chamber of Commerce have taken Ryan, Brady and their colleagues at their word on international taxes.
Continued pressure regarding inversions could force the matter, said Thomas Donohue, the Chamber's president and chief executive officer. But Donohue doesn't expect a full overhaul on taxes this year, he said at a press conference after delivering his annual speech on the state of U.S. businesses Jan. 14.
While it remains to be seen how far congressional Republicans progress, some movement is expected, according to R. Bruce Josten, the Chamber's executive vice president for government affairs.
“Now whether or not that's going to be kind of a template for tax reform as opposed to an actual vote, I can't say,” he said at the news conference. “I think there's going to be a lot of activity here. Where there's activity in this space, we obviously will engage it completely from start to finish.”
With assistance from Steven T. Dennis in Baltimore and Aaron E. Lorenzo in Washington.
To contact the reporter on this story: Casey Wooten in Baltimore at firstname.lastname@example.org
To contact the editor responsible for this story: Brett Ferguson at email@example.com
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)