Featured Articles

Hatch Set to Unveil Changes to Senate Tax Bill as Markup Begins

Posted on November 14, 2017 by Dylan F. Moroses, Stephen K. Cooper

The Senate Finance Committee began its markup of the Tax Cuts and Jobs Act November 13, as committee Chair Orrin G. Hatch, R-Utah, said he expects to unveil a new chairman’s mark that could include provisions dealing with corporate tax rates and international taxation.

Before the markup kicked off, Hatch introduced 27 amendments dealing with a slew of provisions related to retirement savings accounts, homeowner and housing tax incentives, tribal tax benefits, and others related to the international space. As of press time, it was unclear which of those amendments would be included in Hatch’s updated mark, which is expected to be introduced November 14.

“There’s no real cause for concern at this point,” Hatch said during his opening remarks. “But I do want to make clear that we’re looking at a number of alternatives [to provisions in the bill] that will fill the necessary gaps and we have every intention of making the business reforms permanent.”

Hatch’s amendments are among an estimated 300 that committee members could consider over the course of the multiday markup session. The second day of markup is expected to include a detailed explanation of the measure from Joint Committee on Taxation Chief of Staff Thomas Barthold.

After the Finance Committee completes its work on the bill, the next stop for the measure is the Senate Budget Committee, after which it heads to the Senate floor for a vote. A floor vote is not expected before Thanksgiving. In the lower chamber of Congress, the House is expected to vote on its version of the bill — H.R. 1 — as early as November 16. Once both clear their respective chambers, the House and Senate versions must be merged in a conference committee before final passage, which Republicans hope to finish by the end of 2017. 

Some of Hatch’s amendments would raise revenue within the 10-year budget window, while others would require further analysis. Other GOP members filed amendments that represented their constituencies’ interests. Republican Pat Roberts of Kansas submitted several amendments to clarify and improve some agricultural industry tax incentives, while Sen. Chuck Grassley, R-Iowa, included amendments to preserve the biodiesel fuel tax credit and improve the IRS whistleblower program. 

Several amendments from Democrats on the committee would set deadlines for some provisions of the Tax Cuts and Jobs Act to be re-evaluated, forcing Congress to revert to current laws if the legislation does not meet its projected growth figures.

Bipartisanship Under Fire 

In his opening remarks of the markup, Hatch singled out committee Democrats for not working with Republicans on tax reform legislation, citing their written objections to the use of budget reconciliation to bypass the need for their votes on the Senate floor.

“Reconciliation in no way precludes the possibility of bipartisanship and Republicans were prepared to follow a similar route with this particular process as was followed in previous tax bills and budget bills,” Hatch said in prepared remarks. “So, just so everyone is clear, it was the Democrats’ own preconditions that kept them from engaging on tax reform.  There was an open seat at the negotiating table, they collectively chose not to sit in it.” 

Committee Democrats disputed that assertion, saying Hatch and GOP leaders kept them in the dark during the bill’s drafting process. Sen. Claire McCaskill, D-Mo., said Democrats “weren’t invited” into the room. Sen. Mark Warner, D-Va., criticized the “opaque” process, saying GOP tax cuts paid for with borrowed money during a time of full employment will not result in economic growth. 

Finance Committee Democrats also used their opening remarks to highlight the disproportionate amount of tax relief expected to go to the wealthy rather than middle-income individuals in the Senate’s proposal. 

Finance Committee ranking minority member Ron Wyden, D-Ore., made clear that all families may not receive tax relief as a result of the Republicans’ legislation, and urged his colleagues to engage in bipartisan discussions. 

“The first votes are right around the corner,” he said. “And this bill is going to go through major contortions in the days ahead. Those contortions will be about the same bottom line — getting the biggest possible corporate handout through the Senate on a strictly partisan basis,” Wyden said in his prepared remarks.

He said the GOP legislation will give American multinational corporations more relief for doing business overseas than they would get for doing business in the U.S. “I don’t believe it’s a radical idea to say the committee ought to take the time to consider the consequences before the voting begins,” Wyden said. 

Follow Dylan Moroses (@DMoroses3244) and Stephen K. Cooper (@ScoopOnTaxes) and on Twitter for real-time updates.