The Tax Reform Opportunity

Even in a highly polarized political landscape, there is broad congressional support for reforming the U.S. tax code. Tax reform could promote economic growth, reduce complexity, increase transparency and fairness, and improve our nation’s fiscal outlook. Yet comprehensive tax reform remains elusive. In one-on-one conversations with Wall Street Journal tax policy reporter Richard Rubin, Chairman of the House Ways and Means Committee Kevin Brady (R-TX) and House Democratic Whip Steny Hoyer (D-MD) discussed tax reform proposals and how to get legislation over the goal line.

House Democratic Whip Steny Hoyer (MD-05)

House Democratic Whip Steny Hoyer outlined conditions required for progress on tax reform. Hoyer said that the last time there was tax reform, in 1986, both parties were able to come to the table and work to find middle ground. While in 2017 there is “certainly is a consensus that we need tax reform,” Hoyer said a continued lack of agreement on the details has prevented meaningful forward movement.

Like many panelists, Hoyer identified corporate tax reform as an area ripe for activity, but he stressed the need for reforms to be fiscally responsible. “Certainly I don’t think that anybody believes you can bring corporate and personal rates down to 15 percent and still balance the budget,” he said. Looking big picture, Hoyer’s final analysis was that we need to make sure we create a world where our “grandchildren and great-grandchildren aren’t unable to fund the priorities of their time, because we did not give them the resources to do so.”

Representative Kevin Brady (R-TX)

Next, Representative Kevin Brady (R-TX), chairman of the U.S. House Committee on Ways and Means and Joint Committee on Taxation, joined Rubin. Like Hoyer, Brady advocated for reforming the tax code, both by simplifying personal taxes and by lowering the corporate tax rate. Improving our tax system to make it more supportive of economic growth, he said, will be necessary if we want to balance the budget and start paying down our national debt.

Brady acknowledged that getting tax reform done is “tremendously hard work” and said that some disagreement is “healthy” to the process. But he added, “I think that it’s critical to the economy and to businesses that they can have confidence this will get done.”

Brady stressed the importance of reform that affects all earners, saying, “if we flatten these brack- ets out, lower the rates at every level, protect more of those first dollars, and really encourage families to save and invest,” then that “passes down to the middle class as well.” Ultimately, he said, “This isn’t our tax code; it belongs to the American people.”

Download the transcript for this session.

Download the transcript for this session.

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