Business groups suggest punting debt deal to next Congress

By Bernie Becker - 12/03/12 01:19 PM ET

A coalition of influential business groups is calling on Washington policymakers to quickly wrap up their work on the “fiscal cliff” by punting decisions about taxes and spending to the next Congress.

The Tax Relief Coalition said lawmakers and the White House need to make crucial reforms to the country’s entitlement programs and tax code — but in a way that doesn't harm the economic recovery.

“The challenges of crafting a package of revenues and spending cuts to reduce the deficit while protecting a still-fragile recovery are tough, but not impossible,” said the group, which includes the U.S. Chamber of Commerce, National Association of Manufacturers and the National Federation of Independent Business.

The groups urged Congress to extend current tax policies, including the Bush-era rates, and wait until next year to tackle entitlement and tax reforms.

“TRC strongly urges Congress and the administration to move quickly to avoid this crisis by extending current fiscal policy including the expiring and expired tax provisions and making critically necessary reforms to our tax and entitlement systems their highest priority in the next Congress,” the coalition said.

While both parties have said that revenues are going to have to play a role in a deficit deal, the Tax Relief Coalition suggested that decisions over how much and where to raise those revenues shouldn’t occur during the remaining weeks of the lame-duck session of Congress.

“Prolonging the political showdown is a risky economic strategy for the country and the TRC strongly urges Congress to set aside partisan differences and act as soon as possible to address the components of this fiscal cliff,” the group wrote.

Negotiations over the scheduled spending cuts and tax increases have moved slowly since voters reelected President Obama and the House GOP kept its majority almost four weeks ago.

The Obama administration offered Republicans a plan last week that would have raised $1.6 trillion in new revenues, but GOP leaders rejected that proposal.

Democrats have said that Republicans, having rejected the administration framework, should more clearly lay out how they would restrain entitlements and federal spending.

For his part, Speaker John Boehner (R-Ohio) said over the weekend that the GOP was offering $800 billion in fresh revenues, or roughly the same amount that Boehner and Obama discussed in their deficit talks in the summer of 2011.

In a separate letter, the National Association of Wholesaler-Distributors, a TRC member, also called for Washington officials to bridge the partisan divide on the cliff.

But unlike the TRC, the wholesalers group dismissed the most recent proposal from Obama, and said they agreed with Republicans who reacted to it with laughter.

The National Association of Wholesaler-Distributors opposes allowing tax rates for the highest earners to expire, saying that would hurt businesses that pay their taxes through the individual code.

“The proposal sent to Congress last week by the administration would clearly exacerbate rather than solve the problems facing us,” NAW’s leaders said.

— This story was updated at 1:10 p.m.