Freedom Caucus chairman: 'Time is of the essence' on tax reform

Freedom Caucus chairman: 'Time is of the essence' on tax reform
© Greg Nash

House Freedom Caucus Chairman Mark Meadows (R-N.C.) said Friday that Congress should have a "real proposal" on tax reform that lawmakers can start debating by the end of July.

“We believe that time is of the essence,” Meadows said at an event at The Heritage Foundation.

The conservative Freedom Caucus took a formal position earlier this week, calling on the House to work through the August recess to advance GOP priorities such as tax reform.

Meadows said that Congress should cancel recess if there's no detailed tax proposal before August "to make sure that we put the priorities of the American people first on the legislative agenda."

Meadows said that he supports lowering the corporate tax rate as well as the tax rate for businesses whose income is taxed through the individual code. He also wants to allow businesses to have the option of repatriating their foreign earnings at an 8 percent rate over the course of 20 months.

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Additionally, he backs some type of effort on expensing business investments and doubling the standard deduction for individuals.

Meadows praised House Ways and Means Committee Chairman Kevin BradyKevin Patrick BradyRepublicans focus tax hike opposition on capital gains change GOP, business groups snipe at Biden restaurant remarks Top Democrat offers bill to overhaul tax break for business owners MORE (R-Texas) and the White House for releasing tax reform plans.

But the Freedom Caucus chairman suggested that Congress move on from one part of Brady's plan — the border-adjustment proposal to tax imports and exempt exports — since it has faced a lot of pushback from lawmakers. Meadows said that Congress should acknowledge that "the political facts are there is not consensus to have a support for the border-adjustment tax.”

The Freedom Caucus hasn't taken a formal position on the border-adjustment tax, and its membership is divided on it. Rep. Jim Jordan (R-Ohio) blasted the provision during the event, while Rep. Warren Davidson (R-Ohio) said that he could back legislation that includes the tax.

Brady continued to defend the border-adjustment tax this week, saying it helps to encourage companies to bring jobs back into the United States. He also said that those with concerns about it should "bring us their solutions on how we stop jobs from leaving and more importantly bring them back.”

Congressional GOP leaders have said they want tax reform to be revenue neutral.

Jordan said he disagreed.

"Revenue neutral's a fancy way of saying the tax burden stays the same," he said.

Congressional Republicans want to pass tax reform legislation through the Senate with the reconciliation process, which would bypass a potential filibuster and avert the need to court Democratic votes. To do that, Congress first needs to pass a budget for fiscal 2018.

Jordan said that "right now, a budget cannot pass in the House of Representatives." The Freedom Caucus is discussing accepting a higher budget number if welfare reforms are included in a tax bill, he said.