This week (March 7-11)

Congress: The Senate is in session but the House is in recess. The Senate will continue consideration of the Comprehensive Addiction and Recovery Act, S. 524. The bill establishes grants and programs for states and localities to deal with opioid addiction.

CRFB:On Thursday, March 10, the Committee for a Responsible Federal Budget will hold a discussion on "Scoring the Presidential Tax Plans and Understanding Their Fiscal Impacts."

Last week (February 29 - March 4)

House Tax Reform Task Force: On March 2, House Ways and Means Committee Chairman Kevin Brady (R-TX) released a mission statement and broad policy goals for the Task Force on Tax Reform that he chairs, in advance of the group's first idea forum. The Tax Reform Task Force was announced by Republican leaders earlier this year as one of the focus areas for the development of a pro-growth agenda to present to the nation. Chairman Brady has described a dual effort this year to produce a House Republican blueprint detailing a vision for comprehensive pro-growth tax reform, while separately working to draft and try to advance an international tax reform proposal. Chairman Brady said the mission statement for the task force is to, "Create jobs, grow the economy, and raise wages by reducing rates, removing special interest carve-outs, and making our broken tax code simpler and fairer." Principles include ensuring a competitive tax system for both large and small businesses; and ending "the tax code's encouragement of the shift of jobs overseas," by helping US companies compete in the global economy and reducing the tax penalty for bringing overseas earnings home to invest in America. Policy reforms in the statement aim to:

— Lower tax rates for families, small businesses, and corporations.
— Eliminate special-interest carve-outs.
— Reduce complexity in the tax code.
— Reduce the double taxation of savings and investment.
— Reduce the tax bias against headquartering businesses and locating jobs in America.

Hatch says integration proposal delayed: Senate Finance Committee Chairman Orrin Hatch (R-UT) said March 1 that the rollout of his discussion draft on corporate integration will likely be delayed beyond the previously expected release of sometime in March. "It is going to take a little longer. It is a brand new approach towards taxation," Hatch said following a meeting with Joint Committee on Taxation staff on the issue, as reported by Tax Notes. "I think it's going to be pretty hard for us to get all of the ins and outs on it before May." The discussion draft is intended to eliminate the current double taxation of corporate income — once at the corporate level and then again at the shareholder level when the profits are distributed to shareholders as dividends.

Stack on CbCR, PR war on taxes: Treasury Deputy Assistant Secretary for International Tax Affairs Robert Stack said country-by-country reporting rules are expected to be finalized by June 30, Bloomberg BNA reported March 3. Regulations proposed in December will apply to companies' tax years that begin on or after the date the regulations are finalized, which, if by June 30, would capture some 2016 data of companies whose tax year begins after that date. Stack is hoping to demonstrate that the United States is indeed requiring reporting for 2016 and therefore is in accordance with the OECD model, which includes a primary/secondary methodology under which US headquartered companies would provide their CbCR to the IRS rather than the countries where they have affiliates. The news follows Stack's reported comments last week at an International Fiscal Association meeting in Florida (also by Bloomberg BNA) that the US business community has lost the global public relations battle on international tax planning and should consider whether a proposed global minimum tax would be better for their interests than continuing with the status quo.

Clinton claw back proposal: In a speech in Detroit March 4, Hillary Clinton proposed clawing back companies' tax benefits from prior years, including for R&D and the Section 199 deduction for domestic production activities, that are associated with moving jobs abroad. "If you're not going to invest in us, why should taxpayers invest in you?" Clinton asked.

TPC analysis of Clinton, Sanders plans: As the presidential field is narrowing, the Urban Institute-Brookings Institution Tax Policy Center (TPC) said March 3 that Hillary Clinton's tax proposals would increase federal revenue by $1.1 trillion over the first decade and an additional $2.1 trillion over the subsequent 10 years. The report said the top 1% of households by income would shoulder more than three-quarters of Clinton's total tax increases, which include a 4% Fair Share Surcharge on incomes above $5 million and a "Buffett Rule" requiring an effective tax rate of 30% on those making more than $1 million per year. On March 4, TPC said the tax proposals of Bernie Sanders would raise $15.3 trillion over 10 years, mostly from high-income households.

Quote of the Week

"I absolutely agree that business tax reform is one of the important things we need to do for productivity growth. We should be cutting our rate down; the President has proposed a 28% rate. We should be broadening our base and we have an international system that as you alluded to currently is the worst of all worlds. We don't collect very much revenue from it and we still manage to impose substantial distortions on companies. We need to improve both of those. Collect more revenue and reduce the distortion." — Jason Furman, chairman of the White House Council of Economic Advisers, interviewed on Bloomberg Surveillance, March 1

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