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...
Sept. 25 — Tax plans aren't changing for the House Ways and Means Committee, Chairman Paul D. Ryan (R-Wis.) said after the resignation of House Speaker John A. Boehner (R-Ohio) was announced.
The tax issues immediately in front of Congress include renewing expired tax credits and deductions known as extenders, as well as any changes in international tax policy that could be mixed into a multiyear surface transportation bill. Spending authority for the Highway Trust Fund expires at the end of October.
Despite the uncertainties some see, numerous Ways and Means Republicans said they will continue to push forward on all such efforts.
“Nothing has changed on the legislative front as far as I'm concerned,” said Ryan, who insisted he has no interest in becoming the next speaker.
Others on the subcommittee shared that outlook, including Rep. Dave Reichert (R-Wash.), chairman of the Ways and Means Select Revenue Measures subcommittee. He said they still expect to stick to their timeline on highways and international taxes, which could be subject to changes that include establishing a so-called innovation box to tax intangible income at a lower rate—and encourage corporations to keep more of that income in the U.S.
“Our six-year bill, and the Senate's three-year bill, we plan to have all this done by the end of October,” Reichert said, adding that the committee is “absolutely” on track to accomplish that goal.
He and other House Republicans have also been pushing for a handful of permanent extensions on policies such as the credit for research and experimentation and bonus depreciation,. Those talks and highway negotiations will continue as before, said Rep. Devin Nunes (R-Calif.), another Ways and Means member.
Just as Before
“It's going to operate just as it was moving forward,” Nunes said. “Whether or not the Senate's going to want cut a deal, I think that's what it really comes down to.”
Although a new House leadership team will affect which bills reach the floor, Ways and Means isn't about to change what it wants to advance, said Rep. Tom Reed (R-N.Y.), who also sits on the tax-writing committee.
“Overall, I think on the Ways and Means Committee, with Paul at the helm, we clearly know where we need to go. We know the issues that are before us,” said Reed, who added that Ryan has a knack for “looking over the horizon” at policy issues that play out over the longer term.
The House leadership change will shape the relationship with Senate leaders as well as tax policy debates continue, Reed said.
“I'm the eternal optimist, and as you have change in our body, hopefully the relationship with the Senate can continue and get stronger,” Reed said. “I'm looking at this as an opportunity to move forward.”
Rep. Pat Tiberi (R-Ohio), a Boehner ally and another Ways and Means member, said he hopes the change in the speakership will broadly help Republicans push their policy agenda in the face of criticism from the political right.
“The entertainment wing of the party has decided that John Boehner and Mitch McConnell are the problems, and not Barack Obama, and until we get members and civics teachers to teach about how a bill becomes a law, we're going to have this entertainment problem,” Tiberi said.
Boehner announced his resignation, effective at the end of October, to House members on Sept. 25 (see related story in this issue).
Doubts still persist, particularly among those who have long questioned whether a tax deal could come together this year.
“It was never on track,” said Ways and Means ranking member Sander M. Levin (D-Mich.). “I think the speaker's decision doesn't move things.”
Others panel Democrats agreed that Boehner's resignation mostly cements the already minimal expectations for tax advances this year, including Reps. Jim McDermott (D-Wash.) and Bill Pascrell Jr. (D-N.J.).
No long-term highway deal will get done, permanency is unlikely for some of the extenders and broader revisions of the U.S. tax code won't happen, said one lobbyist who spoke on condition of anonymity to avoid client sensitivities.
“There was very little likelihood that tax policy was going to move forward this year anyway,” said Howard Gleckman, senior fellow in the Urban-Brookings Tax Policy Center. “There's just no momentum to do any major tax reform.”
He said he believes renewing extenders represents the only tax legislation that will get addressed before the end of the year, but Gleckman conceded that Ryan is trying his hardest to keep alive the international tax agenda.
In other words, it might not yet be time to fully close the door, even if it is only cracked open just a bit at this point.
“It is hard to see large, complex and new policy moving in this environment and in October, but October is, at best, a soft deadline,” said Sage Eastman, principal at Mehlman Castagnetti Rosen & Thomas, who previously worked as senior Ways and Means counselor.
To contact the reporters on this story: Aaron E. Lorenzo in Washington at email@example.com and Mark Heller in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Brett Ferguson at email@example.com
Notify me when updates are available (No standing order will be created).
Put me on standing order
Notify me when new releases are available (no standing order will be created)