Tax plan a test of House GOP’s ambition?

Tax plan a test of House GOP’s ambition?
© Greg Nash

Rep. Dave Camp (R-Mich.) has a present for the many House Republicans clamoring for a bolder election-year agenda – his long-awaited comprehensive tax reform plan, due out next week. 

Whether they embrace it is the question. 

The Ways and Means Committee chairman’s against-the-odds push to rewrite the tax code will test the GOP’s stated desire to offer up a conservative vision that’s more than merely bashing President Obama. 

Lobbyists, leadership aides and lawmakers are skeptical that Camp’s plan will make it anywhere close to the House floor, but policy-minded members of the Republican conference say there’s a chance, however slim, that the sweeping proposal will inspire a party that has already begun hunkering down for the midterm campaign. 

“If this plan is what we’ve been told it is, the support may be overwhelming,” conservative Rep. Mick MulvaneyJohn (Mick) Michael MulvaneyMulvaney to bankers: Campaign donations will help limit consumer bureau's power Overnight Finance: Stocks fall hard | Trump sending delegation to China for trade talks | SEC fines Yahoo M over breach | Dodd-Frank rollback dominates banking conference Acting CFPB chief mulls taking down public complaint database MORE (R-S.C.) said in a phone interview. 

For Camp, who is likely in his final year at the helm of the tax-writing panel, the plan is the result of a painstaking, three-year effort to scrape the individual and corporate tax code of exemptions and deductions while lowering rates across the board. In addition to dozens of public hearings, he has met privately with groups across the Republican conference, including biweekly sessions over the last year with conservatives. 

Yet while he has shown colleagues bits and pieces of his plan, few members outside his committee and the party leadership have been fully briefed on the draft. 

Republicans have long called for simplifying the tax code in a way that would lower rates and generate economic growth, but party leaders have doubted whether rank-and-file members are ready to defend the elimination of popular, but costly, tax breaks it would take to do so without exploding the deficit. 

Tackling the issue in an election year, another added complication, without an eager partner in the White House is seen as all but impossible.  

Close observers of the process have described Camp’s move to release his plan as something of an experiment.  

Mulvaney said if Camp can deliver on his promise of truly rewriting and flattening the tax code, the rank and file could demand that the leadership give them a committee markup and a vote on the House floor. But if his plan falls short and is seen as “nibbling” around the edges, the appetite could quickly fade. 

Camp himself has cast the plan as a bold challenge to the Washington elite scared to tackle tax reform.  

“They don’t want to look special interests in the eye and say the game is up,” Camp wrote to Ways and Means colleagues last week. “Well, it is.” 

But it’s also far from clear the Ways and Means Committee chairman can deliver on the sort of plan that Mulvaney and other hard-line conservatives are seeking. 

For instance, the lobbyists closely watching Camp’s movements expect the chairman to fall short of his goal of reducing the top individual tax rate from almost 40 percent to 25 percent – a central plank of recent House GOP budgets. 

One K Street official added that, in a shift from issues like immigration and debt, conservatives on the Republican Study Committee (RSC) could be less likely to get in the way of the tax reform plan than more establishment GOP lawmakers. 

“The RSC guys are fine with this sort of stick-it-to-the-man thinking, and roiling established interests,” the lobbyist said. “Where they might have issues is with these moderate Republicans: people who have run businesses, have worked with business, and could say this is no good.” 

The tax proposal will come less than a month after Speaker John BoehnerJohn Andrew BoehnerWe need more congressional oversight on matters of war A warning to Ryan’s successor: The Speakership is no cakewalk With Ryan out, let’s blow up the process for selecting the next Speaker MORE (R-Ohio) released Republican principles for immigration reform in a bid to gauge his members’ support for a major push this year.  

The Speaker retreated after lawmakers voiced doubts about the timing of a move on immigration, but aides say that does not necessarily mean the same scenario would play out on tax reform. 

The GOP leadership has kept its distance from the tax overhaul, voicing general backing but leaving it to Camp and his colleagues on the Ways and Means Committee to rally the conference behind it. 

While Boehner spokesman Michael Steel said the Speaker “strongly supports” tax reform, he is not expected to publicly endorse Camp’s proposal specifically. 

And while immigration has long divided the Republican Party, lawmakers across the conference have embraced the idea of tax reform, at least in the abstract. 

Yet Camp and his allies could face another hurdle in trying to sell a comprehensive tax proposal after many House Republicans, including Boehner, have spent months trashing the notion of large bills and one-size-fits-all approaches on immigration and healthcare. 

Tax reform is simply different, Mulvaney said, because powerful interests will not accept giving up their preferential treatment, through industry-specific provisions, unless they know that “everyone’s ox is getting gored at the same time.” 

“If it’s going to be done, it almost has to be done comprehensively,” he said. “You cannot do tax reform a little bit at a time.”