Congress Returns to Busy Fall Schedule
The House and Senate returned Sept. 5 from a month-long break facing an extremely busy legislative calendar.
The legislative agenda was already packed full, with the need to approve funding legislation for fiscal year 2018 (which begins Oct. 1), increase the debt limit, determine whether to revisit the Affordable Care Act and seek to enact broad-based tax reform/cuts. Now, policymakers must also address federal funding to help repair the devastation caused by Hurricane Harvey.
Reportedly, first out of the gate will be a multibillion-dollar short-term relief package for victims of Hurricane Harvey that may be paired with an increase in the debt limit.
Meanwhile, President Trump last week gave a campaign-style speech in Missouri to try to gin up support for tax reform. While it was billed as a major policy speech, Trump did not provide any additional details on what his plan will look like, other than rehashing the four principles he laid out in April:
- a tax code that is simple, fair, easy to understand and gets rid of “special interest loopholes”
- a competitive tax code that creates more jobs and higher wages for Americans;
- tax relief for middle-class families; and
- a tax code that helps bring back “trillions of dollars in wealth that’s parked overseas.”
The President also reiterated his call to bring the corporate tax rate down to 15% from 35%, and called on Congress to approve legislation that follows the above principles.
Following Trump’s speech, Treasury Secretary Steve Mnuchin said the administration plans to release a more detailed tax reform plan within two weeks, with the goal of implementing it by year-end. Mnuchin did not give a specific date for release, but the proposal could come as soon as this week.
With the Trump administration and congressional Republicans still smarting over the failure to fully repeal the Affordable Care Act, GOP lawmakers are hungry for a legislative win. It is anticipated that Congress’ two tax-writing committees — the House Ways and Means Committee and the Senate Finance Committee — will soon start holding a series of hearings and meetings to continue laying the groundwork for a tax reform package.
Key House and Senate lawmakers and administration officials in late July issued a joint statement affirming their commitment to pursuing tax reform legislation this fall under “regular order.”
Behind the scenes, there continues to be concern that Congress will seek to impose either full or partial “Rothification” as part of the tax reform effort, despite previous statements from administration officials and policymakers that retirement tax incentives would be protected. Part of the concern is over the unintended consequences that may arise from moving toward Rothification, as well as unease that such a move is not being looked at from a public policy perspective, but rather as a simple way to raise revenue under the congressional budget rules to pay for tax cuts.
All in all, it’s looking like a busy fall on Capitol Hill.