Don’t wait to weigh in on tax reform. That’s the message coming from the tax writers on Capitol Hill.
After the flurry of activity this year on comprehensive tax reform—including the House Ways and Means Committee’s working group process, the Senate Finance Committee’s Member meetings on tax reform, and the release of three Ways and Means Committee tax reform discussion drafts and ten Finance Committee tax reform option papers—the obvious question is, “What’s next?” There doesn’t seem to be a clear path forward and the clock is ticking, leaving Members and the public to question the prospects for comprehensive tax reform in this Congress.
However, this moment in time may be the calm before the storm. Chairman Dave Camp (R-MI) and Chairman Max Baucus (D-MT) are as committed as ever to moving ahead on tax reform and are ramping up their efforts in the coming weeks. It is still quite possible that the tax writing committees will take substantive action this year, including mark ups. After being asked what will happen after the Member meetings were completed, Mr. Baucus was quoted as saying, “The rubber meets the road; start trying to make some decisions.” The Finance Committee is widely expected to release discussion drafts with specific reform proposals, perhaps soon and with little advance notice.
Now is a critical time to engage with the tax writers. Although there is skepticism about whether tax reform will actually happen, and the tendency is to wait and see, stakeholders should be doing quite the opposite. It is prime time to participate in the process before the Finance Committee begins generating tangible proposals. Once even a preliminary decision is made by the tax writers to include or exclude a particular tax provision, it can be difficult to change their minds. It is better to weigh in earlier, rather than later.
In addition to issuing specific proposals and detailed discussion drafts, the Chairmen are taking other steps to demonstrate their ongoing commitment to tax reform:
These efforts are aimed at building support for tax reform and developing viable legislation. However, in addition to resolving matters of tax policy, other key issues must be resolved before moving forward that will require lawmakers to make some hard decisions.
Substantive action on tax reform this year remains a real possibility. Offense is the best defense. Stakeholders thinking about engaging with Congress would be well-advised to do so before it’s too late.
This publication/newsletter is for informational purposes and does not contain or convey legal advice. The information herein should not be used or relied upon in regard to any particular facts or circumstances without first consulting a lawyer. Any views expressed herein are those of the author(s) and not necessarily those of the law firm’s clients.