House Democrats to end rule requiring supermajority for tax increases

Tax Hot Topics newsletterPresumptive House Rules Committee chairman Jim McGovern (D-Mass.) has indicated he will not implement a longstanding rule requiring a supermajority to advance tax-raising legislation when Democrats take control of the lower chamber in January.

The rule, which was first introduced in the 104th Congress under then-House Speaker Newt Gingrich (R-Ga.), mandates that any “federal income tax rate increase” considered by the House be approved by a three-fifths majority. Legislation typically only requires a simple majority, or 218 votes, to pass a fully-seated House. Imposition of the rule raises that threshold to 261.

Although House Democrats largely sought to change the rule, they were reportedly divided on just how far to go. Some, including House Minority Leader Nancy Pelosi (D-Calif.), the presumptive House speaker, proposed merely paring it back, lifting the supermajority requirement only for tax increases on the top 20% of taxpayers and corporations. Progressives, on the other hand, led the push to have it scrapped entirely.

The rule would have hindered Democrats’ ability to pass the significant, costly reforms they campaigned on during the midterm elections. Even Republicans had to agree to waive it in order to get tax reform through the House last year. Ending the rule removes one hurdle for Democratic proposals such as Medicare-for-All, a Green New Deal, and tuition-free public college. While those proposals stand no chance of becoming law with Republicans still in control of the White House and Senate, House Democrats are likely to force votes on them for symbolic and political purposes.

Dustin Stamper

Managing Director
Washington National Tax Office
T +1 202 861 4144

Omair Taher

Senior Associate
Washington National Tax Office
T +1 202 861 4143

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