Republicans Hold Tax Committees in A Good Election for GOP

For over 50 years, Bloomberg BNA’s renowned flagship daily news service, Daily Tax Report® has helped leading practitioners and policymakers stay on the cutting edge of taxation and...

By Laura Davison and Kaustuv Basu

Republicans will continue to control the Senate and the House of Representatives as lawmakers look to a possible revamp of the tax code next year.

With Republican president-elect Donald Trump in the White House, House Ways and Means Committee Chairman Kevin Brady (R-Texas) will face less opposition than previously expected as the committee looks to overhaul the tax code. Committee Republicans released a proposal earlier this year that would reduce tax rates for businesses and individual taxpayers, eliminate a number of deductions and restructure U.S. taxes on income from abroad.

Brady will be able to add as many as three new Republicans to the committee to replace Todd Young (R-Ind.), who won a Senate seat, Rep. Charles Boustany Jr. (R-La.), who lost a Senate race, and Rep. Robert Dold (R-Ill.)., who wasn’t re-elected. Exact party ratios for committees will be determined later this year.

Reps. Jackie Walorski (R-Ind.) and Mike Bishop (R-Mich.) are hoping to fill the vacancies, according to aides from their respective offices. Reps. Carlos Curbelo (R-Fla.), Bradley Byrne (R-Ala.) and Andy Barr (R-Ky.) are also interested in the Ways and Means spots, according to lobbyists and House staffers, who asked to speak on background about sensitive personnel matters.

In the Senate, Orrin G. Hatch (R-Utah) keeps control of the Finance Committee as his party prevailed for control of the body. Sens. Richard M. Burr (R-N.C.) and Patrick J. Toomey (R-Pa.), two committee members, held onto their seats in tossup races.

The victory means Hatch will continue to pursue some kind of makeover of the tax code to lower the corporate tax rate and possibly move to a more territorial tax system, lobbyists and staffers said in days leading up to the election. Hatch is also likely to pursue a corporate integration proposal to eliminate the double layer of corporate taxation.

President-elect Donald Trump’s tax plan includes cutting the corporate rate to 15 percent from 35 percent and allowing for repatriation of U.S. corporate profits held overseas, at a one-time tax rate of 10 percent. Details of Trumps tax plan have been subject to some uncertainty, but some provisions have moved closer to the House Republican plan over the course of the campaign.