Nearly 150 House Republicans are pushing Speaker Mike Johnson, R-La., to support legislative action on three expired business tax provisions from the Tax Cuts and Jobs Act by the end of the year.
The November 29 letter, led by Rep. Rudy Yakym III, R-Ind., urges Johnson to back the extension of immediate research and development expensing, full capital expensing, and an interest deductibility rule, but doesn’t specify support for making the extensions retroactive to the provisions’ expiration dates. The letter also doesn’t include the signatures of any House taxwriters.
“While we, the undersigned members, do not sit on Chairman [Jason] Smith’s committee, we want to fully echo our colleagues in stressing consideration of these pro-growth tax changes by the end of 2023,” the lawmakers wrote. “Failing to act quickly will jeopardize hundreds of thousands of American jobs.”
The letter mentions the Build It in America Act, the collection of three tax bills that advanced through the House Ways and Means Committee on party lines June 13 but that has been held up by demands from some House Republicans that it include raising the $10,000 cap for the state and local tax deduction set in the TCJA.
The push is also timely as talks between leaders of the Senate Finance and House Ways and Means committees have heated up of late. The Ways and Means Committee is scheduled to mark up several pieces of legislation November 30, including a bill that would grant treatylike benefits to Taiwan and another on exempt organization provisions, that would qualify as revenue measures and could serve as vehicles for a tax extenders package, according to a Ways and Means majority staffer.
The Taiwan bill — a combination of the Senate’s United States-Taiwan Expedited Double-Tax Relief Act (S. 3084) and the Taiwan Tax Agreement Act of 2023 (S. 1457) — has already received an endorsement from Finance Committee Chair Ron Wyden, D-Ore., and ranking member Mike Crapo, R-Idaho.
Ways and Means Committee Chair Jason Smith, R-Mo., told reporters November 29 that the committee is “considering all kinds of vehicles” on a tax package.
Smith said he believes the Taiwan bill could pass “fairly quickly,” and that he spoke with House Majority Leader Steve Scalise, R-La., about the legislation November 28.
“I hope to get it on the floor and out of our chamber as soon as possible, but of course that’s up to the majority leader,” Smith said.
Lawmakers still face several hurdles, including the need for support from leadership in both chambers and discussion of possible pay-fors to offset the package’s cost.
The House Republicans’ letter also doesn’t mention an expansion of the child tax credit — a measure that Senate Democrats have made clear is a must for bipartisan support of an extension of the TCJA business tax provisions.
The letter encourages action by the end of the year, as Congress would face a further wall attempting to pass any major tax code changes in the new year as the 2024 filing season ramps up.
Ways and Means Committee member Nicole Malliotakis, R-N.Y., told Tax Notes that Smith continues to talk with Senate taxwriting leadership about a package, but said she wasn’t confident that 2023 passage is possible.
“I'm not sure it will be the end of the year; we're not committing to a time frame,” Malliotakis said. “But there’s definitely interest — bicameral interest, bipartisan interest — to get something done.”
Doug Sword contributed to this article.