Thursday, September 14, 2017

Tax "reform" update

According to this account in Politico, the so-called Big Six disagree fundamentally about what their tax "reform" legislation should look like.

Speaker Ryan wants to enact expensing, but "Senate Republicans believe it won't fly in their chamber."

Ryan also wants to eliminate (net?) corporate interest deductions, but "the break is important to many companies, and other negotiators [Senate? Administration?] want only to reduce it."

Ryan wants to repeal state and local tax deductions for individuals, "but some are concerned over what that means for upper-middle class people."

Meanwhile, Senator Hatch favors a corporate integration proposal that presumably is dividend deductibility, but "the idea has not gotten much traction with House Republicans."

These are some pretty fundamental disagreements. Indeed, other than cutting rates and exempting things, which as a standalone cannot plausibly be called "reform" and would of course raise budget issues, there's nothing of comparable importance left. (Home mortgage interest deductions are presumably even a bigger political lift than state and local tax deductions.)

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