By Bernie Becker - 06/19/14 11:43 AM EDT
A top corporate lobby is urging lawmakers to stay away from a corporate tax holiday when they try to shore up the Highway Trust Fund.
Such a move, the Roundtable said, would make it even harder to overhaul the tax reform, an issue where lawmakers have struggled to spur momentum for years.
“Any such limitation on interest deductions would raise the cost of financing new investment for American companies, and thereby disadvantage American companies relative to their foreign-based competitors,” John Engler, the Roundtable’s president, wrote to top congressional tax writers.
“Further, any business tax increase outside of tax reform would reduce the ability to achieve revenue-neutral and permanent comprehensive tax reform to improve the competitiveness of the U.S. economy.”
Lawmakers in both chambers and both parties are struggling to find ways to shore up the highway trust fund, which could run out of money in weeks without congressional action.
House Republicans had pushed to use savings from ending six-day mail delivery to give the trust fund an infusion of revenue, but lobbyists say that idea was dropped after Majority Leader Eric CantorEric CantorLobbying world The Trail 2016: 11 hours, 800 pages, 0 changed minds Juan Williams: The capitulation of Paul Ryan MORE (R-Va.) lost his primary last week.
Senate Finance Committee members have said they’re looking for ways to at least keep the trust fund going until after November’s elections.
Senate Majority Leader Harry ReidHarry ReidDems leery of Planned Parenthood cuts spark Senate scuffle Overnight Finance: Senate sends Puerto Rico bill to Obama | Treasury, lawmakers to meet on tax rules | Obama hits Trump on NAFTA | Fed approves most banks' capital plans Senate passes Puerto Rico debt relief bill MORE (D-Nev.) had floated the idea of using a corporate tax holiday to help stave off bankruptcy for the trust fund. The White House said Wednesday that it didn’t support such a plan.
It would allow corporations to bring back offshore profits, called repatriation, at a temporary tax rate well below the current top rate of 35 percent.
The Joint Committee on Taxation has said that a holiday like the one enacted a decade ago would cost the government tens of billions of dollars over a decade.
But Reid, who discussed the idea with Sen. Rand PaulRand PaulTrump: Rivals who don't back me shouldn't be allowed to run for office Trump hires Rand Paul's former digital director: report Trump flexes new digital muscle MORE (R-Ky.), would have structured the plan to raise $3 billion over 10 years.