Congress turns attention to government funding

Tax Hot Topics newsletter Lawmakers in Washington are working to finalize an agreement to keep the government funded through the upcoming election, leaving the future of a second COVID-19 stimulus bill uncertain.

Negotiations over additional stimulus legislation have been stalled since early August as Republicans and Democrats remain divided over the cost of the package. Senate Republicans attempted to force Democrats back to the table by introducing a narrow, targeted package earlier this month. The “skinny” bill failed after Democrats unanimously voted to block it, reaffirming their desire for broader legislation.

There was some hope that the Sept. 30 deadline to fund the government force a breakthrough, with a must-pass spending bill capable of serving as a vehicle for at least some stimulus. But House Speaker Nancy Pelosi (D-Calif.) and Treasury Secretary Steven Mnuchin have agreed to avoid a possible government shut down so close to the election by opting for clean continuing resolution to extend funding at current levels until sometime after Nov. 3.

Congress could pair stimulus with government funding when the continuing resolution expires later this year, but some lawmakers are still pushing for a stimulus bill before the election. The bipartisan Problem Solvers Caucus has outlined a compromise proposal in an attempt to break the deadlock. President Donald Trump expressed support for the plan, but stopped short of endorsing it.

Pelosi has also indicated stimulus remains a top priority, telling Democrats she would keep the House in session until there is bipartisan agreement. However, it is unclear whether Senate Majority Leader Mitch McConnell (R-Ky.) and the Trump administration share her resolve. Both the House and Senate are currently scheduled to depart Washington in early October for the final stretch of the election and lawmakers will be eager to return home to make their final case to voters.

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

Omair Taher
Washington National Tax Office
T  +1 202 861 4143

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