WASHINGTON – Neither President Donald Trump nor Republican congressional leaders are saying when their tax plan will be ready, but the nation’s premier anti-tax activist has a goal: Sept. 28.
That’s when the still-to-be-determined plan is to be unveiled by the House Ways and Means Committee, said Grover Norquist, president of Americans for Tax Reform.
Norquist, who said he has been working with Republican congressional leaders and the White House on the plan, said he is confident his target date will be met, even though it is only three weeks away and major components of the package have yet to be agreed upon.
While consensus exists on reducing the top corporate income tax rate from 35 percent, there is no agreement on what the new figure should be. Some want to cut it all the way to 15 percent, while others would prioritize allowing immediate write-offs for business expenses, rather than having them claimed as deductions over a period of years, he said.
“Other debates are what cuts are made temporary -– 10 years or less -– or permanent,” he said.
There is a consensus, Norquist said, to eliminate the alternative minimum tax and the estate tax. And there’s a desire to end the deduction for state and local tax payments to pay for cutting rates for individuals.
The alternative minimum tax applies only to wealthier taxpayers who itemize a lot of deductions. The estate tax – or “death tax,” as Norquist and other Republicans like to call it – affects only those Americans who are handing down inheritances worth at least $5.5 million.
Ending the state and local deduction would hit residents of high-tax states the hardest, like those in the northeast and California.
But Norquist said it would win support because the lower corporate rate would be available to the self-employed and to small-business owners who currently pay those taxes on their individual returns. “Thirty million entrepreneurs are a political army,” he said. “They vote.”
Whatever the eventual makeup of the proposal, it may wind up lasting only 10 years, because Senate procedure prohibits any bill passed under special “reconciliation” rules to last longer than a decade if it increases the budget deficit. The reconciliation process allows Senate Republicans to pass tax cuts with a simple majority. The normal process requires 60 votes, which means Republican leaders would need to persuade at least 8 Democrats to back the tax plan.
“They don’t want the bill,” Norquist said. “No real Democratic votes are available. Never were.”
Norquist’s group has long held sway over Republican officeholders, in no small measure because of the anti-tax pledge it has persuaded GOP candidates to sign in recent decades. Of the 52 Republican senators, for example, 47 are listed on the group’s website as having signed the pledge.