The House is "on pace" to get tax reform done by the end of the year, Chief Deputy Majority Whip Rep. Patrick McHenry, R-N.C., said Wednesday, adding that "even the Senate believes" tax reform will be accomplished by year end.
McHenry, speaking at an event held at the Financial Services Roundtable in Washington, said tax reform is needed because the U.S. needs "additional growth; we've seen the middle class left behind, we see global competition for our largest players."
The motivation for tax reform, according to McHenry: "We are certainly at an inflection point, 30 years past our last attempt at tax reform. But we're at a fundamentally different time" than in 1986, he said. The 1986 plan "was largely driven out of the right and the left seeing a complicated tax code and the economic deterrent that that is to growth."
Today, while there's an agreement "on the complexity of the tax code, and a motivation on the left to drive additional revenue into government … we don't have that cross-party — broadly — alliance" for tax reform now, he explained.
"But we do have the tool of reconciliation, which is a natural ingredient for reforming and changing the tax code," McHenry continued. "It enables 51 votes in the Senate … everyone knows the benefits of this process, but it's not a complicated procedure like reconciliation was for changes in entitlement programs or mandatory spending programs. It is a very clear process for the tax code, for revenue measures."
Lawmakers' time now has to be driven by "top-line motivation," McHenry said. "We need additional growth, we've seen the middle class left behind over the last 30 years — they've not gotten ahead financially; we see global competition for our largest players that are incorporated in the United States."
The GOP's unified tax reform framework, released Sept. 27, "was dramatically different than anything we've done since we took the majority in 2011," McHenry said Wednesday. "There's a sense of real pride that we can do something big and complex," he said, adding that the "unity" around the framework enabled the House to get the votes (219-206) to pass its budget.
The Senate marked up its budget resolution last week. Getting the Senate budget "knitted up is that entry point for us to have the detailed coversations in tax reform. We're on pace to get this done by the end of the year," McHenry said.
FSR released a study the same day which found that Americans overwhelmingly believe passing a tax reform bill should be a top priority for Congress to help simplify the U.S. tax code, incentivize lending and retirement savings and grow the economy.
According to the study, three in four voters (73%) said passing a tax reform bill should be a top or important priority for Congress, and nearly 9 in 10 (87%) said it's important to simplify the U.S. tax system.
