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...
Feb. 25 — Opening a door of sorts, House Ways and Means Committee Chairman Kevin Brady (R-Texas) signaled his willingness to use revenue from international tax changes for something more than cutting tax rates.
Brady wants to shift U.S. taxes on multinational companies' foreign profits to more of a territorial or dividend exemption system, and he wants to do it sooner rather than later. The change would yield a one-time revenue boost, which Brady said he would prefer to apply to rate cuts, though he offered to consider pitches from the Democratic side of the aisle.
“I know if this is to be bipartisan, other members have different ideas on where that should go; let's have that discussion,” Brady said at a Tax Policy Center event on Feb. 25.
He considers reaching policy agreement on territorial taxation the most important part of the equation. Brady said lawmakers can deal with revenue concerns later.
“I think we ought to focus on how do we get the policy right for bringing those dollars home and let companies deploy their capital” where it most allows them to grow, he said. “I think we get that policy right, we can have the discussion of where that revenue goes.”
When asked how he would consider funding infrastructure and education, Brady also expressed interest in dynamically scoring spending proposals Democrats might offer.
“I'm one of those that believes that if those changes are big enough, we ought to do dynamic scoring in those areas as well,” Brady said. “I don't have any problem with weighing what the impacts of these investments are rather than some of the estimates we get.”
Brady previously made a case for taking into account economic benefits from wholesale changes to the U.S. tax code as a way to ensure revenue neutrality, rehashing a point he has already made publicly (30 DTR G-4, 2/16/16).
But he dismissed the idea of a deal on taxes and entitlement programs.
“I am not a fan of the grand bargain approach,” Brady said.
Brady and others on his committee have admitted that their efforts on international taxes might not advance beyond a markup in 2016, but they continue to lay the groundwork.
The chairman of the Ways and Means tax policy subcommittee, Rep. Charles Boustany Jr. (R-La.), has said he hopes to introduce legislation by the end of March to switch to more territorial taxation on foreign profits, reduce taxes on intellectual property and maybe cut the U.S. statutory corporate tax rate.
“We cannot sit back and wait for circumstances to be ideal to move forward, so we are going to move forward,” Boustany said. “My goal as chairman of that subcommittee is to write a bill on international, have it ready, and then talk to the speaker and see how far we can go with this” (36 DTR G-8, 2/24/16).
To contact the reporter on this story: Aaron E. Lorenzo in Washington at email@example.com
To contact the editor responsible for this story: Brett Ferguson at firstname.lastname@example.org
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 email@example.com.
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 firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)