Overnight Finance: Congress gets ball rolling on tax reform | Chamber pushes lawmakers to back GOP budget | Rand Paul criticizes tax plan | SEC hack exposed personal data

Overnight Finance: Congress gets ball rolling on tax reform | Chamber pushes lawmakers to back GOP budget | Rand Paul criticizes tax plan | SEC hack exposed personal data
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Congress gets ball rolling on tax reform: Republicans are set to take their first legislative steps this week to advance tax reform, days after the clock ran out for plans to fulfill their pledge to repeal and replace ObamaCare.

The House is set to vote this week on a fiscal 2018 budget, which will pave the way for Republicans to pass tax reform by a simple majority and avoid a Democratic filibuster.

The House Budget Committee advanced the budget in July, but it lacked the votes to pass on the floor due to reluctance from conservative Freedom Caucus members to move forward without a tax reform blueprint.

House and Senate GOP leaders last week unveiled their tax reform framework crafted with the White House, which received widespread support from Freedom Caucus members. The Hill's Cristina Marcos and Jordain Carney tell us what to expect: http://bit.ly/2fLZoQu.

 

Ryan won't guarantee every middle-class person will get a tax cut: House Speaker Paul RyanPaul Davis RyanSenate Dems build huge cash edge in battlegrounds Kelly lobbied Republicans to rebuke Trump after Putin press conference: report Lobbying world MORE (R-Wis.) on Sunday wouldn't guarantee that every middle-class person would get a tax cut under President Trump's tax reform proposal.

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"That's the purpose of doing this," Ryan said on CBS's "Face The Nation." "The purpose of this is to get a middle-class tax cut."

Ryan was pressed on whether that was a guarantee that every middle-class person would get a tax cut under the president's plan.

"Well, I don't know every single person's little, small problem or issue," he said.
Ryan said the purpose of the tax reform plan is to lower middle-class taxes.

"So yes, people are going to get tax cuts. How big are those tax cuts? That depends on the individual," he said: http://bit.ly/2xW5fcO.

 

Rand PaulRandal (Rand) Howard PaulThe Nation editor: Reaction by most of the media to Trump-Putin press conference 'is like mob violence' Lewandowski: Trump-Putin meeting advances goal of world peace Rand Paul to travel to Russia after downplaying election meddling MORE criticizes GOP tax plan: Sen. Rand Paul (R-Ky.) on Monday criticized the tax-reform framework released last week by Trump administration officials and congressional GOP leaders after a think tank issued a report finding that many middle-class taxpayers could see their taxes go up.

"This is a GOP tax plan? Possibly 30% of middle class gets a tax hike? I hope the final details are better than this," Paul said in a tweet that included a link to the study from the Urban-Brookings Tax Policy Center (TPC). http://bit.ly/2fKXQ9h.

 

Lawmakers look to bypass Trump on North Korea sanctions: Senators from both parties increasingly worried about North Korea's nuclear weapons program are talking about bypassing President Trump and hitting the country with sanctions on their own.

That talk is setting up a potential clash between Congress and President Trump, whose administration insists they are already hitting the regime of Kim Jong Un hard.

Trump enacted unprecedented sanctions last week that target banks around the globe that do business with North Korea. It's a major step toward raising pressure on China, Pyongyang's staunchest ally and benefactor, to cut their support for Kim.

Administration officials have urged lawmakers to be let the sanctions already in place work and not tie their hands by acting alone.

But as North Korea presses ahead with its nuclear program and gets closer to a weapon that could hit the U.S., senators are growing impatient. I explain here: http://bit.ly/2fM9GQF.

 

SEC says 2016 hack exposed personal data: Hackers accessed the personal information of two individuals by breaching the Securities and Exchange Commission's (SEC) electronic filing system in 2016, SEC Chairman Jay Clayton revealed Monday.

Clayton said in a Monday statement that hackers accessed the birthdates and Social Security numbers of two people by breaching the SEC's EDGAR electronic filing system, through which publicly traded companies make public and private disclosures about their financial affairs.

The two individuals have been contacted and provided with identity theft prevention and assistance, Clayton said.

SEC officials previously said that no personal information was revealed during the breach, making Monday's revelation a significant change in the severity of the hack.

Officials previously said they think the hackers may have profited by trading on insider information stolen from the EDGAR system: http://bit.ly/2fKRCXi.

 

Happy Monday and welcome back to Overnight Finance. I'm Sylvan Lane, and here's your nightly guide to everything affecting your bills, bank account and bottom line.

See something I missed? Let me know at slane@thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://bit.ly/1NxxW2N.

 

On tap tomorrow

House Financial Services Committee: Hearing entitled "Sustainable Housing Finance: An Update from the Director of the Federal Housing Finance Agency," Mel Watt, 10 a.m. http://bit.ly/2yy5asC.

Senate Banking Committee: Hearing entitled "Wells Fargo: One Year Later" with Wells Fargo CEO Timothy Sloan, 10 a.m. http://bit.ly/2yxvDa0.

Senate Finance Committee: Hearing on international tax reform, 10 a.m. http://bit.ly/2yxzRhD.

Joint Economic Committee: Hearing entitled "The Startup Slump: Can Tax Reform Help Revive American Entrepreneurship," 10 a.m. http://bit.ly/2yxdYPy.

House Energy and Commerce Committee: Hearing entitled "Oversight of the Equifax Data Breach: Answers for Consumers," with Equifax CEO Richard Smith, 10 a.m. http://bit.ly/2yNfsWR.

 

Group launches ad to promote GOP tax framework: A group aligned with House GOP leadership on Monday rolled out a digital ad to promote the tax-reform framework released last week by the White House and Congressional Republicans.

The ad from the American Action Network features economist Douglas Holtz-Eakin, president of the American Action Forum and a former economic adviser to President George W. Bush. Holtz-Eakin highlights several aspects of the GOP tax framework, including its larger standard deduction, expanded child tax credit and lower taxes for small businesses.

"The promise of the framework to working families is: you're going to pay less in taxes," Holtz-Eakin says in the ad. "But the bigger promise is: you're going to pay less in taxes out of a bigger paycheck."

The group said it is spending six figures on the ad campaign, which will run on platforms such as Facebook and YouTube in 42 congressional districts. The districts being targeted include those held by Republicans on the tax-writing House Ways and Means Committee, members of the conservative House Freedom Caucus and GOP lawmakers who are vulnerable in the midterm elections. http://bit.ly/2fJsMH6.

 

Ryan: GOP tax plan will be deficit neutral: Speaker Paul Ryan (R-Wis.) on Sunday said the GOP's proposed tax reform plan will be "deficit neutral," adding that the proposal will spur economic growth that will help reduce the United States' debt.

"It's going to be deficit neutral. That's the budget rules we use, which is call the Byrd Rule," Ryan told host John Dickerson on CBS's "Face the Nation."

Ryan said the tax reform plan would tackle "runaway" government spending, paving the way for economic growth. That growth, he argued, would then help drive down the nation's debt.

"We do fundamentally believe that this tax code and this tax reform will give us faster economic growth. Faster economic growth helps raise the economy, which raises revenues. And that helps us tackle the deficit. There's two things we've got to do to get rid of this debt. Deal with entitlements, that's why we're frustrated health care reform hasn't passed the Senate yet. Deal with runaway spending, but also grow the economy," he said: http://bit.ly/2xWBIzB.

 

On the other side... 100 organizations urge Congress to oppose 'incredibly bad idea' in GOP tax plan: One hundred organizations, including a number of progressive groups and labor unions, are urging Congress to reject a major international tax change proposed in Republicans' framework for a tax overhaul.

In a letter dated Monday, the groups speak out against the framework's move toward a "territorial" tax system that would largely exempt American companies' foreign profits from U.S. tax.

"It is an incredibly bad idea," wrote the groups, which include the AFL-CIO, Americans for Tax Fairness and the Financial Accountability and Corporate Transparency Coalition.

"Ending taxation of offshore profits would give multinational corporations an incentive to send jobs offshore, thereby lowering U.S. wages," they wrote. "It would also be a giant loophole for corporations to use accounting gimmicks to move their profits to tax havens, resulting in the loss of billions of dollars in tax revenue for the United States." http://bit.ly/2fLf86r.

 

Chamber presses lawmakers to back GOP budget: The U.S. Chamber of Commerce, a right-leaning business lobby, is turning up the pressure on lawmakers to vote for the House Budget Resolution, a key step in the tax reform process.

"Make no mistake, the consequences are great. Failing to pass an FY18 budget would extinguish this once-in-a-generation opportunity to simplify the arcane tax code and thereby help families who are struggling to make ends meet, help employers create jobs, increase American competitiveness, and foster strong, sustained economic growth," Suzanne P. Clark, the Chamber's Senior Executive Vice President for Government Affairs, wrote in a letter to House members Monday.

The letter said the budget vote would be recorded on the Chamber's annual scorecard, measuring which members of Congress have voted for and against the Chamber's agenda on issues of note. 

The budget, which is scheduled for a floor vote Thursday, will unlock the process Republicans want to use to pass tax reform without fear of a Democratic filibuster in the Senate: http://bit.ly/2xXe7io.

 

House Dems match Trump's defense proposal in budget: House Democrats are prepared to accept President Trump's suggestion for $54 billion in increased military spending, as long as it's accompanied by an equal increase in nondefense spending.

House Democrats on Monday released their rejoinder to the Republican budget that is expected to pass on the House floor later this week.

Democrats say their proposal would add $6.7 trillion to the deficit over a decade, while the GOP budget adds $2.9 trillion, but claims to balance by the end of that timeframe.

Democrats said the spending would hold overall debt levels roughly steady relative to the growing economy.

Budget proposals from the minority party are primarily electoral messaging documents, but the new proposal is also a Democratic opening bid in the upcoming spending fight for fiscal 2018. The new fiscal year started Sunday, but Congress extended 2017 funding levels through Dec. 8: http://bit.ly/2fKXpMb.

 

Ex-Equifax CEO: Staff missed chance to fix security before breach: Equifax's former chief executive will tell lawmakers Tuesday that the credit bureau botched a critical opportunity to patch the security vulnerability that hackers would eventually use to gain access to its files.

Richard Smith resigned from Equifax following breach that gave intruders access to personal information on as many as 143 million Americans. The House Energy and Commerce subcommittee holding the hearing posted Smith's advance written testimony Monday. 

Smith will testify that Equifax received a warning on March 8 about a vulnerability in Apache Struts software from U.S. CERT, a Department of Homeland Security body that notifies companies of widespread computer security problems. Equifax used Struts as part of its website.

On March 9, the company directed "applicable personnel" to patch that vulnerability. Company policy was to apply such patches within 48 hours. 

"We now know that the vulnerable version of Apache Struts within Equifax was not identified or patched in response to the internal March 9 notification to information technology personnel," Smith wrote in his testimony. http://bit.ly/2fKGrxF.

 

SEC goes after two digital currency scams: The Securities and Exchange Commission (SEC) is charging two companies for defrauding investors through initial coin offerings (ICOs) -- a new method for raising capital with cryptocurrencies.

The SEC says that Maksim Zaslavskiy and his companies have been selling unregistered securities to investors and allege that the digital tokens he offered don't exist.

Investors in Zaslavskiy's company's REcoin Group Foundation and DRC World (also referred to as Diamond Reserve Club) were told that they could expect significant returns on their investments while both companies were not actually in operation, according to the SEC's complaint.

Zaslavskiy allegedly billed REcoin as "The First Ever Cryptocurrency Backed by Real Estate" and told investors that the company had a "team of lawyers, professionals, brokers and accountants" to facilitate the investments. The SEC alleges that no such professionals were actually hired. With REcoin, Zaslavskiy was able to raise between $2 million and $4 million: http://bit.ly/2fKIQbF.

 

Trump administration weighing executive order on welfare: President Trump and his team are weighing whether to issue an executive order that would require federal agencies to review welfare programs that assist low-income earners, Politico reported Monday.

The decision is part of wave of changes the White House is considering making to the nation's welfare system, according to the report.

Two administration officials told the newspaper that the administration sent around a draft of the order last week to agencies seeking comments about the proposed draft plan.

The draft instructs the federal agencies to look at their current programs and regulations in place, and then propose ways to update and reform the welfare system: http://bit.ly/2xWQeHH.

 

Write us with tips, suggestions and news: slane@thehill.com, vneedham@thehill.com, njagoda@thehill.com and nelis@thehill.com. Follow us on Twitter: @SylvanLane, @VickofTheHill, @NJagoda and @NivElis