Newer crop of tax writers prepares to take on legacy 2017 law

Caitlin Reilly | (TNS) CQ-Roll Call

WASHINGTON — Member turnover on the tax-writing committees and in Congress broadly has given rise to a feeling on and off Capitol Hill that nothing is off the table in next year’s tax deadline negotiations, including provisions made permanent by the 2017 tax law.

The effects of this turnover are likely to be felt more deeply in a Republican sweep or divided government next year, as churn has been more dramatic on the GOP side of the dais. The lineup changes pose two primary challenges for those who would like to see the 2017 law extended: the need to educate new members on the policies and trade-offs included in the law, and adapt to shifting political winds less friendly to wealthy individuals and big corporations.

“The political dynamic today is different than it was in 2017,” said Senate Finance Committee ranking member Michael D. Crapo, R-Idaho. “There are different approaches and philosophies about tax policy that may be stronger or weaker today than they were then. And I think that that just makes it more incumbent that we understand exactly what we did and why and how it worked.”

Lower tax rates on individuals, relief from the alternative minimum tax, treatment of money U.S. companies make abroad, small-business deductions and other provisions established by 2017 law are set to expire or become less generous at the end of next year.

Eighty percent of the Republicans on the House Ways and Means Committee and a little over half on Finance joined the committee after enactment of the 2017 law. There are only five Ways and Means and six Senate Finance Republicans remaining on those panels from that time.

Republicans on both committees have started member education efforts with topic-specific working groups.

There has been less turnover among Democrats on the House and Senate panels since 2017 and substantially less since 2021 when they worked on legislation that eventually became the 2022 health care and clean energy budget law, a closer corollary for Democrats when it comes to next year than the Republican-passed tax law.

Peter Roskam, a partner at BakerHostetler and former Ways and Means member who helped write the 2017 law, said given those dynamics stakeholders should start engaging lawmakers now, rather than waiting until after the November elections.

“Everything’s on the table. And I think it’s a real strategic mistake to make an assumption that says, ‘Hey, we’re good. We’re fine. Nobody’s going to touch this,’” the Illinois Republican said. “I just don’t think that’s true in this environment, and that some of the choices that members are going to be forced to make will end up being very uncomfortable.”

Shifting politics

The turnover has brought with it a shift in politics, including a growing populist vein within each party. The change has K Street preparing to play defense on behalf of business-friendly tax breaks, particularly the 21 percent corporate tax rate that the law made permanent, unlike other breaks aimed at households.

President Joe Biden has said he’d like to increase the rate to …read more

Source:: The Mercury News – Entertainment


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