U.S. House Ways and Means Chairman Kevin Brady (R-TX) today announced that the House Republican tax reform bill will be unveiled on November 1, 2017, and the committee will begin acting on the bill on November 6, 2017. The November 1 release will be the long-awaited first look at the House bill by the public.
Chairman Brady’s announcement followed today's approval by the U.S. House of Representatives of the FY18 budget resolution by a vote of 216 to 212. This approval was a major step forward in the progression of the tax reform process.
By approving the same version of the budget that was passed by the Senate on October 19, 2017 (read TaxNewsFlash), the path for processing tax reform has potentially been accelerated by days or even weeks.
The budget that was approved today by the House and previously by the Senate will allow Congress to use the budget reconciliation process for a tax reform bill. Use of reconciliation will allow the Senate to potentially avoid a filibuster and, thus, be able to pass a tax reform bill with only a simple majority of 51 votes (a minimum of 50 senators, plus a potential tie breaking vote by Vice President Mike Pence). This is a more attainable goal for the 52 Senate Republicans than achieving the 60 votes needed to overcome a potential filibuster.
The budget that was passed by the House and Senate allows Congress to pass a tax bill that could contain a net tax cut of up to $1.5 trillion (over a 10-year window). However, it is important to keep in mind that in order to maintain the filibuster protection afforded by the reconciliation rules, the tax bill will be required to comply with a number of very complex procedural requirements that are required by the rules governing the consideration of reconciliation legislation.
Today was a very significant day in the tax reform process but it is important to keep in mind that a long road still lays ahead. With the announcement by Chairman Brady of a schedule for Ways and Means Committee action, a very aggressive timeframe has been set forth in the House. If the Senate pursues an equally aggressive schedule, it is possible that a year-end deadline for tax reform could be met. However, a hiccup at any of the many necessary process steps along the way could cause a cascading effect that could doom the legislation or, at minimum, extend the process into early 2018.
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