Senate Fails to Reach Accord on Budget Conference

The Senate on May 7 failed to reach agreement for the third time on formation of a conference committee to reconcile the House and Senate Budget resolutions. Prior to asking for unanimous consent agreement to begin naming conferees, Senate Budget Committee Chairwoman Patty Murray, D-Wash., chided Senate GOP members for blocking her efforts. “Senate Republicans have now blocked our efforts to move to conference not once but twice,” said Murray. “I know this isn’t going to be easy. There are vast differences between the Senate and the House budgets…but waiting until the last minute is not a good option.”

Senate Minority Leader Mitch McConnell, R-Ky,. objected on the grounds that the Senate-approved Democratic budget includes tax increases. “I would ask consent that the senator modify her request so that it not be in order for the senate to consider a conference report that includes tax increases or reconciliation instructions to increase taxes or raise the debt ceiling,” said McConnell. The current debt limit is set to expire on May 19 and Republicans may use debt-limit negotiations to push for spending cuts and to prevent tax increases. On May 6, Senate Majority Leader Harry Reid, D-Nev., called for a unanimous consent agreement to appoint budget conferees, but the move was objected to by Sen. Ted Cruz, R-Tex.

Congress approved the No Budget, No Pay Act of 2013 (P.L. 113-3 ), in late January 2013, which raised the nation’s borrowing authority for three months. Prior to congressional approval of the debt-ceiling increase, President Obama stressed that he would not negotiate with Republicans over raising the debt limit in exchange for spending cuts. At the time, Obama said he would hold separate talks about lowering the deficit, which would involve closing tax loopholes through reform and additional cuts, but he would not negotiate “with a gun at the head of the American people.”

Tax experts have stated that the differences in the House and Senate budget resolutions underscore a major challenge to enacting tax reform in the 113th Congress. The House-passed budget resolution (HConRes 25) calls for a revenue-neutral tax reform that substantially reduces both individual and corporate tax rates. The Senate-passed budget resolution (SConRes 8 ) calls for changes in revenue policies that would raise additional revenues. The president’s fiscal year 2014 budget proposal would use some portion of revenues for revenue-neutral tax reform, while using other revenues, primarily increases in individual income taxes, to reduce the deficit. Congress remains divided over whether additional revenue raised through the budget should be used to reduce rates, reduce the deficit or finance other government initiatives.

By Jeff Carlson, CCH News Staff

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