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House Speaker Mike Johnson (R-LA) September 17 promised a "Day One" focus on corporate tax policy if there is Republican control of the House, Senate, and the White House next year, saying, "The first thing we want to do is promote investment and opportunity. And we do that by extending and building upon the Trump tax cuts." He said Republicans will ensure the US is the "preeminent location for the investment and innovation and technology by restoring immediate expensing for R&D costs, by ensuring a strong FDII incentive to encourage U.S. ownership of intellectual property and restoring the 100% expensing provision."

Johnson, who joined Congress in 2017 ahead of the TCJA's enactment, further said, "And we'll keep those cuts in place to support job creation along with the double guaranteed deduction and a strong child tax credit. But unlike the Democrats' proposal, we will ensure that our tax policy respects the dignity of work, and it doesn't pay people for staying out of the workforce."

The foreign-derived intangible income (FDII) deduction of 37.5% (for a 13.125% rate) is set to drop to 21.875% (for a 16.40625% rate) after 2025. Expensing for R&D costs ended after 2021, replaced by five-year amortization, and 100% expensing began being phased down after 2022. Both of those provisions were addressed in the Tax Relief for American Families and Workers Act (H.R. 7024) approved by the House January 31 before being blocked in the Senate August 1.

Speaker Johnson, who was being interviewed by former Trump administration NEC Director Larry Kudlow at The America First Policy Institute, suggested regulatory reform is complementary to the GOP's tax-cutting priority. "I think they've got to go together. The Tax Cuts & Jobs Act was a phenomenal achievement, and it did so much good for the economy. But it was the regulatory reform that accompanied that, that was really the secret sauce, I think," he said. "And President Trump wants to take a blowtorch to the regulatory state, and I want to help him hold it. We have big, aggressive plans to do that, but again, we've got to have the levers of power … And I think we're going to have the, again, majorities in both chambers, and we'll work with President Trump and all of you, the administration, to make this happen."

A September 16 letter to House Ways & Means Committee members from business groups led by the U.S. Chamber of Commerce cited the groups' support for H.R. 8184, the Growing and Preserving Innovation in America Act, to permanently preserve the FDII deduction and prevent its phasedown. "The FDII deduction has proven remarkably effective at furthering its policy aims and should be made a permanent, undiluted feature of the U.S. international tax system," the letter said.

Meanwhile, the SALT deduction cap is back on the table, as Former President Trump, whose signature TCJA law capped the deduction at $10,000, pledged on social media September 17, ahead of a New York City appearance, "to get SALT back, lower your Taxes, and so much more." The SALT deduction cap expires along with other TCJA individual provisions after 2025. Members from high-tax states tried in vain to secure relief from the cap from Congress after the TCJA's passage. The SALT Marriage Penalty Elimination Act (H.R. 7160), to provide a $20,000 SALT deduction cap for joint filers with adjusted gross income of less than $500,000 for 2023, failed to advance in the House February 14, 2024.

The Tax Foundation has estimated that if the $10,000 cap was made permanent, it would raise about $1.2 trillion from 2026 to 2033. "A compromise option that would make permanent a more generous version of the cap compared to current law by increasing the amount to $15,000 single ($30,000 joint) would raise $564 billion over 10 years after losing revenue under the current law baseline in 2024 and 2025," the group said.

New this morning: IRS proposed regulations on the Section 30C Alternative Fuel Vehicle Refueling Property Credit.

The Senate Banking Economic Policy Subcommittee is holding a hearing on "The Macroeconomic Impacts of Potential Tax Reform in 2025" today (Wednesday, September 18) at 2 p.m.

Government funding — The House is planning to vote today on Speaker Mike Johnson's (R-LA) continuing resolution (CR) through March 28, 2025, which also includes the SAVE Act bill to ensure only US citizens are registered to vote. The vote is expected to fail but demonstrate that such a measure can't pass and free the House to act on a CR that can move through Congress before the September 30 expiration of government funding.

Health — A September 17 Senate procedural vote on the Right to IVF Act (S. 4445), sponsored by Senator Tammy Duckworth (D-IL), failed. The vote was 51-44, and 60 votes were required. Senators Susan Collins (R-ME) and Lisa Murkowski (R-AK) were the only Republicans to vote in favor. The New York Times reported: "Senate Republicans on Tuesday blocked an election-season bid by Democrats to advance legislation that would guarantee federal protections and insurance coverage for in vitro fertilization treatments, the second time in three months that the G.O.P. has thwarted the broadly popular measure."

During the September 17 Senate Finance Committee hearing, "Lower Health Care Costs for Americans: Understanding the Benefits of the Inflation Reduction Act," Chairman Ron Wyden (D-OR) said Republican Vice Presidential candidate Senator JD Vance (R-OH) saying recently that all Americans should not be in the same health insurance "risk pool" means "if you have a pre-existing condition or if you are at high risk of developing a chronic illness, insurance companies will be allowed to isolate you from younger and healthier Americans. That means they'll only sell you insurance that's prohibitively expensive or limited in benefits." Witness Jeanne Lambrew of The Century Foundation said, "We know from experience that having separate risk pools often leads people with pre-existing conditions to pay higher premiums for health insurance, often being priced out of that coverage altogether."

Ranking Member Mike Crapo (R-ID) cited testimony from witness Theo Merkel, from the Paragon Health Institute and the Manhattan Institute, about enhanced premium subsidies being inflationary.

A Finance hearing related to Women's Health Care has been noticed for Tuesday, September 24 (10 a.m.).