The House Ways and Means Committee on November 7 spent a second day marking up the Tax Cuts and Jobs Bill (HR 1). According to Senate Majority Leader Mitch McConnell, R-Ky., the Senate tax reform bill is expected to be released by November 10. However, SFC member Dean Heller, R-Nev., said that the bill will be released on November 9.
Second Day of Tax Reform Markup
During the second day of tax reform markup, Democrats offered amendments that failed on party-line votes. Rep. Ron Kind, D-Wis., offered an amendment that extended the repeal of the individual State and Local Tax (SALT) deduction to all business organizations. “Let’s also ask the corporations of America to also give up the deductions,” Kind said. He called the GOP proposal to eliminate the deduction for individuals a “pay-for” for the proposed tax cuts.
As the bill stands, the SALT deduction is only eliminated on the individual side of the tax code. According to Rep. Devin Nunes, R-Calif., the deduction was eliminated on the individual side because it allows states to continue to raise taxes and primarily benefits wealthy taxpayers. Further, eliminating the deduction for businesses would “create massive distortions in the marketplace,” Nunes said.
House Democrats further criticized the GOP tax bill during a November 7 press briefing. During the briefing Ways and Means member Joe Crowley, D-N.Y., defined the legislation as “taking from the poor to give to the rich.” According to Crowley, the bill “caters to the needs of special interest corporations, as well as the rich and wealthy and most powerful in this nation, at the expense of the middle class.”
As Ways and Means members continued debate, House GOP leadership dismissed Democrats’ criticisms. They also dismissed various estimates showing that the House tax bill will create more deficit than economic growth can pay for. “We believe we’re going to be fine on that,” House Speaker Paul Ryan, R-Wis., told reporters on November 7.” We believe that when you look at other analysis, whether it’s going to be Treasury or the rest, that we’re right there in the sweet spot with economic growth that gives us more revenue,” he added. The Joint Committee on Taxation (JCT) is expected to release a report using dynamic scoring that will estimate how economic growth will impact the over $1.4 trillion cost to the federal budget from the bill’s proposed tax cuts.
“Don’t believe everything you read,” Ways and Means Chairman Kevin Brady, R-Tex., said on November 7, referencing a retracted estimate the day before by the Urban Brookings Tax Policy Center (TPC). The TPC cited to certain misinterpretations as the cause for the retraction and is expected to release additional estimates. “You’re going to see a lot of different analysis that at the end of the day just isn’t accurate,” according to Brady.
At press time, the Ways and Means Committee was expected to continue debate late into the evening. The committee will resume markup of the measure on November 8.
By Jessica Jeane, Wolters Kluwer News Staff