Opening pitch on tax overhaul
Job creators need break, AT&T official tells panel, but Democrats balk
WASHINGTON — House Republicans are turning to corporate America to make their opening pitch for a tax overhaul.
A House Ways and Means Committee hearing held Thursday on muchdiscussed plans to revamp the nation’s tax code leaned heavily on testimony from the business bigwigs who could be among the big winners from proposals to lower corporate tax rates and simplify the system.
And headlining that effort was AT&T, the Dallasbased telecom giant.
“We need to reduce the top corporate rate,” said John Stephens, the company’s chief financial officer. “This is the quickest, most straightforward way to jump-start investment in our country.”
The hearing marked Congress’ first formal attempt this year to grapple with the nation’s convoluted tax code.
Republicans are pushing for a sweeping overhaul that they say would spark economic growth by providing relief to businesses and individuals alike. And there’s added urgency as GOP leaders look to talk about anything other than the latest drama surrounding President Donald Trump.
But the attention on businesses — and how they’ll benefit — only sharpened debate.
Democrats continue to criticize the proposals as overly generous to the rich. Republicans disagree on the revamps’ fundamental
elements, particularly as it relates to the corporate world. And looming over the entire debate is how to pay for such an expansive reboot.
Top House Republicans, however, said the need for a business focus was obvious.
“Washington must take less from America’s job creators so they can invest more in their businesses, their workers, and their futures,” said Texas Rep. Kevin Brady, the Republican who leads the tax panel.
A tax revamp has long been on the agenda in Washington.
It’s been 30 years since lawmakers reconfigured the code in any comprehensive way. Officials in both parties agree that the current system is broken. And with the GOP controlling the White House and Congress, the push moved toward the top of the legislative list.
Democrats have focused their messaging on what a tax overhaul would mean for middle-class Americans, saying that the proposals at hand do too much for wealthy individuals and companies. And some offered little sympathy Thursday for corporate titans like AT&T.
“Apparently our tax code is outdated, it’s full of loopholes, it doesn’t work very well,” said Austin Rep. Lloyd Doggett, a high-ranking Democrat on the panel. “But the witnesses before us today are companies that seem to have done pretty well under that system.”
Republicans like Brady, however, argue that it’s not that simple.
Corporate tax relief stands at the center of most every GOP proposal: Lower the rates — to 15 percent in Trump’s plan. Extend that break to “pass-through” businesses that pay taxes through their owners’ personal returns. Allow businesses to write off the expense of capital investments.
The idea is that those changes end up boosting average Americans.
“This will increase investment” said Stephens of AT&T. “Increasing investment increases jobs. When you increase jobs, you increase wages.” It also means trade-offs. House GOP leadership has stressed the need for a tax overhaul that doesn’t increase the federal deficit, even if Trump hasn’t made that same commitment. And to accomplish that for a massive revamp that also includes lower individual rates, revenue has to come from somewhere.
Those funds could come from a divisive border adjustment tax, or from eliminating any number of beloved deductions and exemptions.
Rep. Kevin Brady, R-The Woodlands, chairs a House Ways and Means Committee that opened a hearing on tax policy Thursday. “Washington must take less from America’s job creators,” Brady said.