Coalitions offer united front on tax reform

Originally Published by Bernie Becker, The Hill, September 19, 2013

A pair of tax reform coalitions offered a united front on Thursday, coming together to press the case for a top-to-bottom overhaul of the code.

Leaders of the RATE Coalition and the Coalition for Fair Effective Tax Rates stressed at a joint Capitol Hill event that both the individual and corporate sides of the code need to be revamped.

The RATE Coalition and other similar groups are made up of corporations, an area where Democrats and Republicans have seemingly found more common ground.

But the effective tax rate coalition, which launched this summer, includes many small businesses who pay taxes through the individual code — and would be left behind in a corporate-only reform.

The new coalition, co-chaired by the Retail Industry Leaders Association (RILA) and the National Federation for Independent Business (NFIB), is also more focused on the rates that businesses actually pay, while RATE and others are interested in lowering the statutory rates.

That’s why the two groups came together Thursday, with a message that businesses of all shapes and sizes wanted a full-scale reform.

“What unites the RATE Coalition and the Coalition for Fair Effective Tax Rates is a commitment to reforming this code,” said Jim Pinkerton, a RATE co-chairman and onetime adviser to Presidents Reagan and George H.W. Bush.

House Ways and Means Committee Chairman Dave Camp (R-Mich.) and Senate Finance Committee Chairman Max Baucus (D-Mont.) also praised the two groups for coming together.

Still, leaders of the two groups — while saying they had faith in Camp and Baucus — aknowledged that there were many hurdles for tax reform, and noted that the last successful overhaul, in 1986, almost died many times along the way. House Republicans are currently considering tying procedures for tax reform to a debt-limit hike.

Corporate groups and small business organizations also are working together after finding themselves at odds at times during last year’s “fiscal cliff” debate, which ended with pass-through businesses — not corporations — receiving a rate increase.

Bill Hughes of RILA said at Thursday’s event that he understood there might be some “cynicism” about the coalitions coming together.

But, he added, “I think it’s pretty significant – two different coalitions, coming together and saying the same thing.”