Democratic lawmakers failed to show any visible progress in the last two weeks toward a potential slimmed-down reconciliation bill to carry some of the tax priorities of the stalled Build Back Better (BBB) agenda.
Democrats have been stalled for months as Sen. Joe Manchin, D-W.Va., has offered the idea of resurrecting key pieces of BBB in a bill that would reduce the deficit and fund a few key priorities. Manchin emerged from a meeting with Sen. Chuck Schumer seemingly open to the idea of a bill with a corporate tax rate increase to 25%, and a top capital gains tax increased to 28%, but no concrete negotiations have occurred since.
Sen. Kyrsten Sinema, D-Ariz., also remains steadfast in her opposition to raising tax rates, recently telling reporters "You all know, the entire country knows, that I am opposed to raising the corporate income tax. That was true yesterday, that is true today."
Further complicating matters, Manchin announced several weeks ago that he was launching bipartisan talks focused on climate and energy legislation—topics that are heavily represented in the House-passed version of the reconciliation bill.
While the specifics of the Manchin’s proposed bipartisan package remain unclear, some lawmakers have expressed their doubts on the ultimate passage of such legislation. Sen. Kevin Cramer, R-N.D., noted, “Is there something that can attract 10 Republicans that doesn’t scare away 10 Democrats?” Cramer further noted, “If it starts looking like a reconciliation or Build Back Better, then obviously Republicans will be out.” Sen. Ben Cardin, D-Md., expressed a similar sentiment, stating, “I think that’s going to be a heavy lift. If he can do it, great.”
Notwithstanding the bipartisan energy package, Democrats have said significant progress will need to occur before the Memorial Day recess for passage of a party-line reconciliation bill to remain a possibility. Other members offered looser deadlines of the July 4 or August recesses. The closer the calendar creeps to the November elections, the harder it will become for Democrats to strike any deal.
Dustin Stamper is a managing director in Grant Thornton’s Washington National Tax Office and leads the tax legislative affairs practice for the firm.
Washington DC, Washington DC
More tax hot topics
No Results Found. Please search again using different keywords and/or filters.