07/27/2017

‘Big Six’ Unify Around Tax Reform Framework

Officials are drafting a set of broad guidelines for enacting comprehensive tax reform later this year

Administration officials have worked with congressional Republicans to draft a set of broad guidelines for enacting comprehensive tax reform later this year.

The plan highlights areas of agreement among congressional tax-writing committees and the Trump administration, including a lower tax rate for all American businesses and incentives for American companies to bring back jobs and profits from overseas.

Treasury Secretary Steven Mnuchin and National Economic Council Director Gary Cohn have been meeting regularly with House Ways and Means Committee Chairman Kevin Brady (R-TX), Speaker Paul Ryan (R-WI), Senate Finance Committee Chairman Orrin Hatch (R-UT) and Senate Majority Leader Mitch McConnell (R-KY) to discuss priorities for overhauling the tax code.

The controversial border adjustment tax (BAT), which would tax imports at 20 percent, was not included in the framework. Ryan and the other members of the GOP’s so-called “Big Six” said this week that they’re no longer looking at a BAT. “While we have debated the pro-growth benefits of border adjustability, we appreciate that there are many unknowns associated with it and have decided to set this policy aside in order to advance tax reform,” the tax writers said in a statement.

White House officials are also reportedly working on a plan to pass a short-term, targeted tax cut if efforts to pass a broader overhaul of the tax code fall through. The plan would be to cut the corporate tax rate from 35 percent to 15 percent for 10 years, double the standardized deduction for taxpayers, and allow companies to bring revenue back from overseas without a significant tax penalty. Mnuchin told reporters this week he is focused on comprehensive tax reform.

“We’re working very hard on continued details of the plan and we look forward to releasing them when we release them,” he told BNA this week.

This article was provided to OSAE by The Power of A and ASAE's Inroads.