In what is being hailed as a “major speech,” which means just about nothing to ordinary Americans living outside the D.C. bubble, House Speaker Paul Ryan is expected to call for permanent tax reform in 2017 in remarks to be delivered to the National Association of Manufacturers. According to the Washington Examiner, Ryan will report that the GOP intends to introduce and pass a joint tax bill in the fall of this year.
“We are going to get this done in 2017. We need to get this done in 2017. We cannot let this once-in-a-generation moment slip.”
“Transformational tax reform can be done, and we are moving forward. Full speed ahead.”
The @HouseGOP plan for tax reform will create more jobs & increase wages, putting American workers & families first. https://t.co/TgaUyqc4WJ
— Paul Ryan (@SpeakerRyan) June 20, 2017
One component of Ryan’s tax plan, the so-called border adjustment provision, has become very controversial even among his Republican colleagues. It has elicited fierce opposition from retailers and other industries that fear it would result in higher taxes on imported products. In effect, the border adjustment would work by exempting export sales from companies’ taxable income, but disallowing the deduction of the cost of imported goods from taxable income.
“While acknowledging that the particular mechanism must be sorted out with the administration, he will argue that we must fix the current incentive for American companies to move abroad, make things overseas, and then sell them back into America — which costs us jobs,” his office said. Ryan will also stress that the U.S. needs a more competitive tax system after years of being disadvantaged.
“We are actually unique in the world in the way we discourage capital from coming back to America and how we incentivize off-shoring jobs,” he’ll say. “This is not the kind of exceptionalism we should aspire to…We must think differently, so that once again we make things here and export them around the world.”
We will also eliminate many of the loopholes used by the wealthy and well-connected, helping to lower the tax rates for American families.
— Paul Ryan (@SpeakerRyan) June 20, 2017
Meanwhile, Republicans will have to pass their tax package via a continuing resolution to take advantage of their simple majority in the Senate, a procedural move that will prevent Democrats from blocking it. Under such a procedure, the tax package cannot add to long-term budget deficits.
That said, in order to take advantage of the procedure, Republicans in the House and Senate must pass a budget resolution. And while that may sound simple enough, the Republican party is bitterly split over spending levels for the military and various domestic programs.
Of course, major tax reform has been a key agenda item for Republicans for quite a while and only time will tell whether it is possible or, as John Boehnor would say, just a bunch of Republican “happy talk.”
via http://ift.tt/2smpsFe Tyler Durden