Politico Pro
February 13, 2013

Baucus: Finance moving toward rewrite

Senate Finance Committee Chairman Max Baucus doesn’t plan to formally split his committee members into working groups like his House counterpart but said he’s still moving ahead on tax reform.

“Ways and Means is a little different from Finance, but we’re moving along at a parallel pace,” Baucus told reporters Wednesday.

House Ways and Means Committee Chairman Dave Camp is expected to soon announce the creation of 11 working groups that would deliberate on issues ranging from energy to charitable donations. Michigan Rep. Sandy Levin, the top Democrat on Ways and Means, told POLITICO on Tuesday that the working groups are meant to study the various issues but not issue formal recommendations.

Across the Capitol, Senate Finance leaders are more focused on winning bipartisan buy-in on options papers or discussion drafts that could be issued this spring.

“We’re actually chatting with our members and doing what we can,” Utah Sen. Orrin Hatch, the top Republican on Finance, said Wednesday. “We haven’t set up formal working groups, but I’m in the process.”

Before much happens on tax reform, the Senate must first decide whether and how to avoid $85 billion in spending cuts slated to kick in on March 1.

Baucus said there would be action on that front in the next few days but wouldn’t commit to the type of revenue he would like to see tapped to delay the sequester.

When asked specifically whether he would support raising taxes on the carried interest income paid to private equity and other investment managers, he responded that “we’ve got to get measures that can pass.”

He also signaled a general reluctance to use revenue sources that might be helpful later in the year to pay for a rate-lowering tax reform.

“I want to make sure we have measures left for tax reform,” he said.

Senate leaders are considering paying for a sequester delay by imposing a minimum tax on millionaires, which would leave specific provisions of the tax code on the table for later reform efforts.

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