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...
Dec. 9 — Senate Finance Committee Chairman Orrin G. Hatch (R-Utah) isn’t killing off his corporate integration plan, but said his focus will shift to plans to comprehensively overhaul the tax code.
“I remain very interested in the concept of corporate integration and continue to believe that it would have a positive impact on our tax system and our economy overall,” Hatch said in a Dec. 9 speech on the Senate floor. “But, let’s be honest, Mr. President, after this election, the ground has shifted, and, while we don’t know how everything will play out in the coming months, it’s safe to assume that the tax reform discussion is shifting as well.”
Hatch has not yet released his plan to provide a dividends-paid deduction to corporations, but said the proposal received positive feedback from the Joint Committee on Taxation. Hatch’s comments indicate he will likely hold off on releasing plan details while the Finance Committee works within the framework proposed by House Ways and Means Republicans. Ways and Means Chairman Kevin Brady (R-Texas) has said he hopes to push big tax legislation in 2017.
Amid all the tax revamp noise in the House, Senate Finance Committee member Benjamin L. Cardin (D-Md.) has reintroduced a consumption tax measure he has pushed for years.
The bill (S. 3529), which has been refined since its introduction in 2014, would generate revenue by taxing the purchase of goods and services.
“The Progressive Consumption Tax Act puts this country on a competitive playing field with other nations by providing for a broad-based progressive consumption tax, or PCT, at a rate of 10 percent,” Cardin said in a Dec. 9 statement.
The bill would lower the corporate tax rate to 17 percent.
Four tax benefits remain untouched in the bill—the charitable contribution deduction, the state and local tax deduction, health and retirement benefits and the mortgage interest deduction.
Cardin’s office said in a statement that the bill was reintroduced now “to show what responsible legislation that moves towards a consumption-base could look like as tax reform discussions move forward in 2017.”
Don’t bank on sustained economic growth of 4 percent, analysts at the Committee for a Responsible Federal Budget said.
Demographics work against the goal, touted by President-elect Donald Trump, the analysts said in a blog post on the group’s website. More baby boomers are beginning to retire and average labor force growth of 0.5 percent per year is expected, about a percentage point below historical averages.
Trump’s tax ideas to boost capital stocks would improve growth, but the resulting increase in federal debt would nullify any expansion, the post said. And increased immigration, which could also improve growth, isn’t expected under Trump.
“With a much slower growing labor force, achieving sustained 3.5 percent annual growth would require increasing projected productivity growth by nearly 150 percent, from 1.1 percent to about 2.6 percent per year,” the analysts said. “This level of productivity growth has not been sustained over any decade in modern history.”
To contact the editor responsible for this story: Meg Shreve at email@example.com
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
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)