House Ways and Means Committee Chairman Kevin Brady is reaching across the aisle to discuss tax reform with Democrats, the next item on President Donald Trump’s legislative agenda following the failure of health care reform legislation.
Trump pledged during last year’s campaign to simplify the tax code by streamlining brackets, reducing corporate taxes and eliminating loopholes in the first major overhaul since 1986.
House Republicans have called for major tax cuts for the wealthy and a 20 percent tax on imports, which is opposed by retailers. Democrats oppose both proposals.
White House spokesman Sean Spicer said last week Trump plans to lead the tax reform effort, but Politico reported it’s unlikely any legislation written by the White House would be enacted.
Brady said he’s willing to listen to Democrats’ ideas for stopping the migration of U.S. companies overseas and simplifying the tax code for individuals, Reuters reported.
"At the end of the day, I don't want to make a prediction as to where that goes. But I think this engagement's important," Brady told reporters on Monday. "I'd love to have them bring their ideas on how we leapfrog America back into the lead as the most competitive place on Earth for that new business."
Brady is expected to meet with the 16 Democrats on the Ways and Means panel Wednesday. Democrats had no immediate comment.
Brady said the proposed meeting had nothing to do with the inability of Republicans to repeal the Affordable Care Act March 24, largely because the ultra-conservative Freedom Caucus refused to go along.
Trump has said he’s willing to work with Democrats on tax reform. The White House said last month it would consider deficit-funded tax cuts and a value-added tax for businesses.
Joe Rosenberg, a Tax Policy Center fellow, told PolitiFact whatever tax cuts are proposed will need to be offset by spending cuts or loophole elimination to make conservatives happy.
"In tax reform, the easy part is the reduction in tax rates, and the hard part is everything else," he said.
During the campaign, Trump proposed cutting taxes to zero for couples making as much as $50,000, and to 10 percent for those making as much as $100,000. Home mortgage and charitable donation deductions would be preserved but other deductions would be reduced in the 20 percent and 25 percent brackets.
For corporations, Trump wants to cut the top tax rate from 35 percent to 15 percent, however, few companies pay that top rate anyway due to deductions. He also promised to plug special interest loopholes.
Legislation was expected to be unveiled in coming weeks with a possible vote during the summer.
The Republican outline does not address the Obamacare taxes, with Speaker Paul Ryan saying those taxes remain with the health care legislation.