Answer: no, but that won’t stop them from trying. Donald Trump hinted at a second pass at tax reform during the midterm campaign, but that didn’t save the House majority for the Republican Party. Instead of tackling the second phase of tax reform next year, Republicans will play Beat the Clock to get it passed before New Year’s Day:
House Republicans on Monday evening unexpectedly released a 297-page tax bill they hope to move during the lame-duck session of Congress.
The legislation would revive a number of expired tax provisions known as “extenders,” address glitches in the Tax Cuts and Jobs Act and make a range of changes to savings- and retirement-related tax provisions.
Other parts of the bill would revamp the IRS, provide new tax breaks for start-up businesses and offer assistance to disaster victims.
Republicans have talked about a second phase of their tax-reform efforts since before passing the first phase. In order to comply with the rules of reconciliation, the first phase had to apply a sunset to tax cuts for individuals, which take effect after eight years. The rates will go back up unless Congress acts to make those rates permanent — which has to be accomplished outside of a reconciliation vehicle.
This bill, however, doesn’t appear to address that issue at all. Instead, it appears to be a technical bill that tinkers with specific deductions and exemptions, ranging from the ubiquitous (deductions for “qualified tuition”) to the esoteric (“Classification of certain race horses as 3-year property”). The only item made permanent in the new tax bill is a “railroad track maintenance credit,” which would be nice for those who, er, pay to maintain railroad track. For the rest of us, though, it doesn’t exactly look like a broad tax reform effort or much of a follow-up to the signature GOP achievement of this session.
As tax reform, this isn’t exactly impressive, but Republicans still plan to press this through the lame duck session. House Ways and Means chair Kevin Brady insists that this package contains policies that “have support for Republicans and Democrats in both chambers,” which may well be true given the modest aims contained within this bill. That doesn’t mean that Democrats will let Republicans take the lead on pushing them forward or packaging them to the GOP’s benefit just five weeks before taking charge of the House process themselves.
The inclusion of disaster relief funding is designed to put Democrats in a tough position to say no, but Senate Democrats may find a way to do so anyway:
“The first time Finance Committee Dems saw Brady’s legislation was in his press release,” [Senator Ron] Wyden spokeswoman Rachel McCleery tweeted Monday evening. “There was no communication from his staff, including a heads up that something was coming. That is not how you negotiate.” …
Earlier today, Wyden had complained of his House counterparts: “They are not negotiating with Democrats.”
“They are not having conversations with Democrats and to have an extenders package or a technical corrections package, at some point the majority has got to come to the minority and talk about plans,” he said.
The bill would need at least 60 votes in the Senate to pass, so Senate Democrats do have some say in whether it goes forward. Even though Democrats will be in a slightly weaker position in the Senate after the new year, their House majority will provide a much firmer backstop. The lack of negotiation suggests that Republicans already know what the answer will be, as much as that lack guarantees the answer.