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Hatch Remarks at Finance Committee Markup of Tax Cuts and Jobs Act
WASHINGTON – Senate Finance Committee Chairman Orrin Hatch (R-Utah) today delivered the following remarks at the committee markup of the Senate tax overhaul package, the Tax Cuts and Jobs Act:
Today, the committee will continue its consideration of the chairman’s mark for the Tax Cuts and Jobs Act. We will begin by walking through the mark with the help of Mr. Tom Barthold, the Chief of Staff for the Joint Committee on Taxation, and then proceed to questions from members.
Following the conclusion of this this process, which will likely take some time, a modified mark will be provided to members later today which reflects input received from the amendments that have been filed. Because of a large number of amendments that we have processed, the modified mark will be given to members later today, as has been discussed with the Ranking Member, and everyone can then have time to read over the modifications. After that process, we will resume the markup tomorrow morning with the modified mark.
But before we proceed today, I want to make a few comments.
I appreciated members’ participation during yesterday’s session. I was glad to hear everyone’s initial thoughts.
However, a number of issues were raised yesterday that, in my view, warrant some additional responses.
First is the characterization of the bill as a massive tax cut for the rich. That particular claim was repeated, I believe, by almost every minority member of this committee.
The problem with that claim is that it’s just not true.
The Joint Committee on Taxation, the nonpartisan congressional scorekeeper, has concluded that, not only does the bill maintain the current level of progressivity in the tax code, but that the largest tax cuts – in terms of percentage of income – will go to middle-income earners.
I understand that the distributional analysis is inconvenient for the Democrats’ who are committed to the narrative that Republicans intend to give the so-called rich a huge tax cut, but JCT’s analysis shouldn’t be ignored altogether.
Second, there was the repeated claim – supposedly based on JCT analysis – that the bill is a massive tax HIKE on the middle class. To reach this conclusion, members had to willfully twist the meaning of JCT data.
Specifically, members cited a JCT table concluding that some in the middle class may see a tax increase under the bill, while those same members completely ignored the fact that the very same data showed that the vast majority of middle class taxpayers – about 90 percent – were either going to get a tax cut or, at the very least, be held harmless under the bill.
Yesterday, I mentioned a tax bill introduced by the Ranking Member a few years back. I noted that there were a number of similarities between his previous bill and the one we’re debating today. However, there are some differences.
For example, I’m not aware of any JCT distributional analysis on the Wyden-Coats tax bill, but the Tax Policy Center did look at some of the potential distributional effects of the Ranking Member’s bill when he introduced it with former Senator Gregg.
Interestingly enough, TPC found that close to 25 percent of middle-income taxpayers would have gotten tax increase under Wyden-Coats, and around 17 percent of the lowest income earners would have seen their taxes raised.
Now, I don’t raise this to play tit-for-tat. And, I do think there are reasons to not consider analyses by outside think tanks to be the gospel when it comes to these matters. But, I do think it’s fair to note, for the record, that the Ranking Member, in the relatively recent past, authored and championed tax reform legislation that, according to the standards he and others have used to criticize the current bill, was far more problematic and, according to a think tank often cited by members on the other side, would have raised taxes on far more middle- and low-income taxpayers than the legislation we are considering this week.
Next, I want to address the many complaints about process we heard during opening remarks yesterday. Members lamented the lack of hearings, arguing that the 70-plus hearings we’ve had since I’ve been the lead Republican on this committee weren’t enough and that we needed multiple additional hearings to examine the specifics of the chairman’s mark.
What they didn’t mention was that this demand would be a significant departure from the way this committee has traditionally operated. Historically, the committee hasn’t held hearings on specific marks issued by its chairmen. We certainly didn’t do so when we considered the Affordable Care Act, or any other major mark in the modern history of the committee.
It is, therefore, absurd to demand that we do so now.
In addition, we heard members complain about the partisan nature of this exercise. Yet, I don’t believe a single committee member of the minority even acknowledged the fact that, three months ago, every single one of them signed a letter indicating, among other things, that they would not engage in a bipartisan tax reform process unless Republicans agreed up front to not use reconciliation.
Given the history of this committee and Congress’s recent history with regard to tax policy, such a demand is entirely unreasonable. It is not a rarity for major tax bills to move through reconciliation. And, the potential use of reconciliation in no way bars the possibility of bipartisan compromise. Knowing this, I can only conclude that the intent of my colleagues’ letter was to communicate that they had no intention of engaging meaningfully in tax reform.
But, even if I’m wrong in that interpretation, over the past 10 months, I have made countless public statements where I called on my Democratic colleagues to join in this effort, to offer their views and advice without preconditions or upfront demands. Yet, to my knowledge, no one on the Democratic side said anything to suggest that my conclusion about their prerequisites was incorrect.
For what it’s worth, I’m still hoping we can get some Democratic votes in favor of this bill. As I mentioned yesterday, the vast majority of the major proposals in our bill have enjoyed bipartisan support in the recent past, including from Democratic members of this committee.
Middle-class tax relief is something that members of both parties should be able to get behind.
Lowering corporate tax rates and making America’s businesses more competitive is something that both Republicans and Democrats have sought to do for years.
And, updating our outdated international system has been a bipartisan endeavor for a while a now. As I noted yesterday, the Senate minority leader, as a co-chair of one of our working groups, drafted a report calling for international tax reforms that are consistent with what we’re trying to do with this bill.
I intend to move forward. If members want to vote on the substance of the policy and not with an eye toward next November, I think a few more will eventually find themselves supporting this approach.
This is a good bill. It will give real tax relief to middle-class families. It will grow our economy, increase wages, and create jobs. I think that, ultimately, most members who decide to vote against it based on partisan strategy will regret taking such a course.
Once again, the next step in this process is to walk through the mark. We’ll begin that process in a few minutes.
To view a full copy of the chairman’s mark, click here.
A score of the mark may be found here.
A section-by-section of the mark may be found here.
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