By Bernie Becker and Kevin Bogardus - 12/11/12 10:00 AM EST
K Street is giving Speaker John Boehner’s proposal to raise $800 billion in tax revenue the benefit of the doubt — for now.
Business lobbies say that it’s difficult to take a position on the “fiscal cliff” framework that Boehner (R-Ohio) offered last week, in large part because the Speaker has yet to spell out which tax breaks he would put on the chopping block to raise hundreds of billions of dollars.
Jade West, senior vice president of government relations of the National Association of Wholesaler-Distributors (NAW), said Boehner enjoys more trust from business groups on taxes than does Obama.
“I’m much more confident of a tax policy written by John Boehner, who used to run a small business, rather than someone who has never signed a paycheck on the front,” she said.
But that doesn’t mean that Boehner’s revenue offer to the president isn’t a source of concern.
“Yeah, we are nervous about John putting $800 billion in new tax revenue on the table,” West said. “We were nervous when he put $800 billion in new tax revenue on the table a year ago when he was bargaining with the president over the debt ceiling.”
The K Street response to Boehner’s offer underscores the delicate nature of the tax-and-spending negotiations, and the anxiety over what might end up in a final deal.
Many groups around Washington are loath to rattle the cage and comment too publicly about the negotiations, especially now that the talks have become a two-man game between Boehner and Obama.
The U.S. Chamber of Commerce, the nation’s largest business lobby, is reserving judgment until a fleshed-out deficit proposal is released.
“The devil is in the details,” Blair Latoff, a spokeswoman for the U.S. Chamber of Commerce, told The Hill in a statement. “Until we see a plan that achieves the goals we have articulated, and can discuss it with our members, it would be premature for us to comment.”
Boehner’s $800 billion revenue offer — signed off on by other top House Republicans — is part of a concerted effort by GOP leaders to prevent tax increases on the wealthy from being part of an agreement to avoid the fiscal cliff.
The Obama administration has pushed for $1.6 trillion in revenue that would come from both increasing the top tax rate above the current 35 percent, among other policy changes.
Congressional Republicans cite studies that assert that wringing revenues out of tax breaks can raise roughly the same amount of money for the government as allowing the high-end rates to expire.
One such study, from the Committee for a Responsible Federal Budget, said that some of those ideas — capping itemized deductions, limiting the amount of breaks a taxpayer can claim to a percentage of their income or limiting and then phasing out so-called tax expenditures — would target the wealthy for revenue, as Democrats have demanded.
Several business groups have joined Republicans in drawing a line against rate increases, and are prodding lawmakers to raise revenue through a broad tax reform that strips out or limits tax breaks.
The Tax Relief Coalition, a group that includes NAW, the Chamber and the National Association of Manufacturers (NAM), last week called on lawmakers to extend current tax policies and rewrite the code in the next Congress.
Top officials from NAM met Monday with White House officials, continuing to make the case that rate increases would hurt manufacturers that pay taxes through the individual code.
Behind the scenes, Washington groups are fighting fiercely to ensure that their favored tax breaks aren’t sacrificed for revenue in a debt agreement.
The nonprofit sector, looking to protect the break for charitable giving, is caught in a tug-of-war between Republicans who are floating a cap on deductions and the Obama administration, which has sought for years to limit the amount of deductions the wealthy can take.
“We strongly believe the charitable deduction has no place in discussions about the fiscal cliff, and we are not interested in getting in the middle of a partisan political struggle,” the Independent Sector, a nonprofit coalition, said in a statement last week.
And the housing industry — from builders to real estate agents to mortgage bankers — is pressing the case for the preservation of the mortgage interest deduction.
The National Association of Realtors last week urged its members to get in touch with lawmakers. In a separate letter sent to every lawmaker and the president, the trade group asked Washington to make sure that “in the rush to avoid going off of one cliff, America’s homeowners don’t get tossed off another.”
But even as it pushes hard for the mortgage interest break, the Realtor group has stopped short of criticizing Boehner for putting tax incentives on the negotiating table. Jamie Gregory, the group’s deputy chief lobbyist, would only say to The Hill that any changes to the mortgage interest deduction should be fully vetted by congressional committees.
“There is a lot that has to happen in [these] three weeks,” Gregory said. “The proposals need to be fleshed out more and they need to get closer together. There is more work that needs to be done by both sides to find common ground.”