The House Ways and Means Committee will soon meet to vote on the tax provisions of the Democrats’ budget reconciliation bill.
They will be voting for one of the largest tax increases in history to help pay for what House Budget Committee Chairman John Yarmuth has said was “the largest single piece of legislation in history.”
The $3 trillion of tax increases under consideration include higher individual tax rates, higher corporate tax rates, and higher capital gains and dividend tax rates. They include a complete rewrite of international tax rules, new taxes on pass-through businesses, and higher estate and gift taxes. These are major changes that will have a significant impact on individual taxpayers, families, and businesses. They will have a major impact on financial markets and U.S. competitiveness. Yet, these changes are racing through the Ways and Means Committee like no other major tax bill in history.
Committee members have reportedly been instructed that there are to be no amendments offered, no objections raised, and no debate at all. The intention is to rush this massive tax increase through the committee as quickly as possible.
This is in stark contrast to the way the committee has handled major tax legislation in the past, including the Tax Reform Act of 1986. President Ronald Reagan submitted his tax reform plan to Congress in May 1985, and the Ways and Means Committee began hearings on the plan in June. The committee held 30 days of hearings through the summer, receiving testimony.
The committee then spent two months marking up the bill, considering scores of amendments before approving it and sending it to the House floor on Dec. 3. When the bill passed the House on Dec. 17, everybody had had ample time to read and analyze the bill.
Senate consideration of the bill extended into the summer of 1986, and there were more public hearings and a lengthy Senate floor debate, with 26 roll-call votes on amendments. The final bill was passed and signed into law that fall.
Congress spent a year and a half drafting and passing the Tax Reform Act of 1986. The Ways and Means Committee worked for six months on the bill before it went to the floor.
Yet, in the next few days, the committee plans to rush another major rewrite of our tax laws through the committee, with no amendments, no debate, and not one public hearing. Members of the committee will be asked to approve this massive bill without a Congressional Budget Office score, and with no analysis of the bill’s impact on inflation, investment, jobs, or economic growth.
This is not the way to make such fundamental changes to our nation’s tax laws.
Bruce Thompson was a U.S. Senate aide, assistant secretary of treasury for legislative affairs, and director of government relations for Merrill Lynch for 22 years.
