GOP Frustration Grows as Lack of Cohesion Plagues Tax Bill (Corrected)

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By Laura Davison, Colleen Murphy, and Kaustuv Basu

House Republican dissatisfaction is growing over the absence of tax bill details and a lack of cohesion with the Senate, as the House prepares to release legislation next week.

The Ways and Means Committee is set to release a bill Nov. 1 as long as the budget passes this week. But Republican lawmakers are craving more information about the measure’s contents: whether, for example, it will preserve a 39.6 percent tax rate for high earners or contain a compromise with GOP lawmakers from high-tax states to preserve some of the state and local tax (SALT) deduction.

“There are many of us frustrated that we have no details,” Rep. Chris Collins (R-N.Y.) told reporters Oct. 24. “We don’t know the brackets. We don’t know where we are on the 39.6. We don’t know where we are on SALT. We don’t know where we are on the size of the child tax credit.”

One House Republican, who requested anonymity to speak candidly, noted that the Senate might disregard aspects of the Republican tax framework released in September, which called for a 20 percent corporate rate, 25 percent passthrough rate, and tax cuts for individuals. It isn’t clear that there is agreement between the House and Senate about what the final product will look like, the lawmaker said.

Marc Short, director of legislative affairs at the White House, told reporters he is confident the House and Senate are on the same page. “I think that we will have unity among Republicans in getting tax relief,” he said.

Senate-Side Insults

Tensions between Senate Republicans and President Donald Trump ran high Oct. 24.

Sen. Bob Corker (R-Tenn.), in a series of television interviews, criticized Trump’s leadership. Trump shot back, saying Corker couldn’t get elected dog catcher in his home state. House and Senate Republican leaders were quick to respond, saying the feud won’t complicate tax efforts.

The feud wasn’t referenced during a lunch meeting with Senate Republicans and Trump, Corker told reporters. Trump’s message focused on the achievements so far this year, Senate Majority Whip John Cornyn (R-Texas) told reporters. Trump talked about regulatory changes, growth in the stock market, and bills that did pass this year, Cornyn said.

“It wasn’t a whole lot about taxes. We’re all pretty clear about what’s going to happen next,” Cornyn said. “I think the pathway is clear.”

After the meeting, Sen. Jeff Flake (R-Ariz.), a vulnerable Republican who was up for re-election in 2018, said he wouldn’t run again. He said he regrets the coarseness of leadership and indecency of discourse in politics.

Lobbying Action Heats Up

Rep. David Schweikert (R-Ariz.) said he feels optimistic about where the Ways and Means Committee is at, but expects the pressure on members to heat up considerably in the coming weeks. Businesses that benefit from the current system won’t go down without a fight, and lobbyists who benefit from complexities in the tax code won’t either, he said. Ways and Means members have faced that pressure for months, but members on other committees may not be “completely prepared for what’s about to hit them.”

“You have to expect the people who really want to derail this train on K Street and elsewhere are gearing up,” Schweikert told Bloomberg Tax. “I’m not sure a lot of the members appreciate the knife fight that’s coming. Because it’s always about the money.”

The Senate will likely dial back proposals after seeing the pressure put on House members following a bill release, a Republican aide said. Because Senate Republicans can only afford to lose two votes and pass a bill, compared with 22 votes in the House, the Senate proposal is widely expected to be a more moderate version of what the House creates.

“There’s always a concern and a frustration that we have to take these votes here knowing that they won’t be the final vote when we get to the finish line,” Rep. Tom Reed (R-N.Y.) told Bloomberg Tax.

House Speaker Paul D. Ryan (R-Wis.) is aiming to have the bill pass the House by Thanksgiving and arrive on the president’s desk before the end of the year. House leadership and Trump continue to project confidence that a bill can pass, but rank-and-file members are worried the timeline isn’t realistic.

Concern Over Division

Rep. James B. Renacci (R-Ohio) told reporters he is “absolutely” concerned about the potential gulf between the House and Senate. House Freedom Caucus Chairman Mark Meadows (R-N.C.) said a Senate bill that would set the corporate tax rate above 20 percent wouldn’t be able to pass the House.

“I’ve been promised that we will get to 20 percent,” Meadows said. “I will say, get their pencils out and keep sharpening, because I have heard this 23, 24 percent number before. I’m not going to go there. There will not be the votes there to do that.”

Rep. Matt Gaetz (R-Fla.), a member of the House Republican Study Committee, said at an event Oct. 24 that the House will almost undoubtedly pass whatever bill the Senate lands on. “Long live the Senate,” he said jokingly.

“We all know at the end of the day, no matter what we send to the Senate, it will be given no more serious consideration than anything else we’ve sent to the Senate and they’ll give us back something and we’ll probably take it,” he said.

Rep. Joe L. Barton (R-Texas), another Freedom Caucus member, said he is skeptical a bill can pass. He is one of the few lawmakers who were in Congress 31 years ago when the last major tax overhaul was passed.

In 1986, tax reform “barely passed and it took a year and a half and it took several meltdowns,” he told reporters Oct. 23. “House leadership is committed to the principle. I think the fact you don’t have a bill yet is that they keep trying to put the puzzle pieces together and it doesn’t fit.”

(Corrects Gaetz's membership affiliation)

With assistance from Alex Ruoff in Washington.

To contact the reporters on this story: Laura Davison in Washington at lDavison@bna.com; Colleen Murphy in Washington at cmurphy@bna.com; Kaustuv Basu in Washington at kbasu@bna.com

To contact the editor responsible for this story: Meg Shreve at mshreve@bna.com

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