The House version of the tax bill scheduled to be released Thursday won’t include an immediate and permanent reduction in the corporate tax rate to 20 percent, Ways and Means Committee Chairman Kevin Brady said Wednesday night.
Instead, Brady told reporters, it would take “several steps” to achieve that goal, a top priority for President Trump, conservatives, and companies.
Brady maintained that the legislation is still intended to include a permanent reduction in the corporate rate. Any maneuvering until it is voted on would be meant to comply with Senate rules, he said. Under the fast-track budget reconciliation procedure Republicans are using, tax changes cannot add to deficits beyond a 10-year timeframe. The corporate tax rate reduction is one of the biggest revenue-losers in the GOP plan.
“At the end of the day, I’m confident we’ll make all the pro-growth provisions permanent,” Brady said. “Certainly, the business rates for growth, a top priority.”
Brady’s stated plan, as of Wednesday evening, was to introduce legislation Thursday. But he has said that the initial text will be replaced by a chairman’s amendment in time for the bill markup planned for Monday. One possibility would be that Republicans write down the corporate tax rate reduction as temporary until they can agree on an offset elsewhere in the tax code to allow it to be permanent within the scope of Senate rules. Then they could add that offset later in the legislative process.
Asked if the 20 percent corporate rate would remain permanent, committee member Rep. Carlos Curbelo of Florida replied, “I don’t know about that.”
The committee had just left an hours-long meeting on tax reform to attend votes on the House floor.
A 20 percent permanent corporate tax rate has long been the goal of Brady and House Speaker Paul Ryan, who have warned that high corporate tax rates are forcing companies overseas. They have said that businesses require certainty about the tax code to move operations and jobs back to the U.S.
“We believe that permanence makes for the best tax policy,” said James Pinkerton, a representative of the RATE Coalition of major businesses advocating for a lower corporate rate. “Companies, and their millions of workers, do best when they can plan ahead with confidence in a steady economic environment.”
