|House Budget Plan|
Speaker Ryan’s email message and blog post today notes that the House Republican budget plan “paves the way for transformational tax reform.” The Budget Committee has a markup session this morning. When Speaker Ryan tours the New Balance factory in Massachusetts on July 20 he will “promote the historic tax reform plan currently being developed by the House, Senate, and Trump administration.” [7/17/17 press release]
Here is what’s in the 63-page budget plan released in July, Building a Better America – A Plan for Fiscal Responsibility, related to tax reform [page 22]:
- The FY18 budget resolution “instructs the Ways & Means Committee to produce deficit-neutral tax reform legislation that will reduce tax rates and simplify the tax code to boost economic growth.”
- The budget plan presents the following reasons to simplify:
- A corporate rate reduction is desired to promote competitiveness.
- Ways and Means Committee should develop “specific policies” for “deficit-neutral, fundamental tax reform that:
A few observations:
- When will the tax reform plan be released and will it be an outline or legislative language?
- Will there also be a lower rate for business income of entities not operating in the corporate form? The House Republican blueprint of June 2016 said yes (page 17, 23 and 27), the budget plan is silent (but brief).
- Will the border-adjusted tax and consumption tax aspects of the June 2016 House Republican blueprint be part of the plan? Speaker Ryan’s press release about visiting New Balance’s factory stresses that it’s an American factory.
- How will lower rates be addressed with base broadeners for revenue neutrality?
- Will there be distributional neutrality?
- Will there be hearings once there is legislative language? This question was asked by Senator McCaskill at the 7/18/17 Senate Finance Committee hearing. Chairman Hatch said he wasn’t sure – he would like to have hearings, but could not guarantee it. Senator Hatch also noted that they were having a hearing right now, to which Senator McCaskill noted that they were not discussing an actual bill. Her questions start at about 2:02 hours into the hearing. All four witnesses – former Assistant Secretaries of Tax Policy at Treasury answered her question that “yes” bipartisan legislation would be good. For the Tax Reform Act of 1986, there were over 100 days of public hearings, markup, subcommittee meetings, and conference meetings (see pages 1 – 4 of General Explanation Of The Tax Reform Act of 1986, (H.R. 3838, 99th Congress, Public Law 99-514 (Bluebook)). That’s a lot of hearings. Of course, not all likely were on legislative language.