May 16,2019
Grassley on Launch of Bipartisan Taskforces to Resolve Temporary Tax Policy
Prepared Floor
Remarks by U.S. Senator Chuck Grassley of Iowa
Chairman, U.S.
Senate Finance Committee
On the Launch of
the Senate Finance Committee Taskforces
To Resolve
Temporary Tax Policy
Thursday, May 16,
2019
On
February 28th, I came to the floor to talk about the more than two dozen tax
provisions that have expired since the end of 2017. That same day, I joined
with Finance Committee Ranking Member Wyden to introduce the Tax Extender
and Disaster Relief Act of 2019 to extend those provisions through 2019.
Unfortunately,
we’re still waiting on House Democrats to send us a tax bill that includes
those provisions so taxpayers who’ve relied on an extension can finish their
2018 tax returns. I remind my colleagues in the House that taxpayers have all
but run out of time.
Part
of my purpose in introducing the Tax Extender and Disaster Relief Act in
February was to provide additional certainty for the current year. I noted that
in most cases, Congress enacted those provisions to provide an incentive for
taxpayers to engage in certain actions like investment and job creation. I also
reminded my colleagues that those incentives are most effective when taxpayers
can rely on them during the tax year. Regrettably, we’re now a third of the way
through 2019 with no certainty for affected taxpayers in sight.
I
also said in my February remarks that my broader objective of including an
extension through 2019 was so we could have some maneuvering room to examine
the temporary provisions overall and try to identify longer-term solutions.
Through
efforts in the last Congress, we’ve identified potential long-term solutions
for two of them – the short-line railroad tax credit and the biodiesel tax
credit. But we have the opportunity to do more.
While
we continue to try to help taxpayers who still need to resolve their 2018 tax
returns, we need to press ahead on more permanent solutions so we can end
Congress’ bad habit of waiting until the 11th hour – or months after – to
extend temporary tax policy.
Accordingly,
today I am announcing, along with Ranking Member Wyden, that the Finance
Committee will form several bipartisan taskforces to examine the temporary tax
policies. These taskforces will consist of members of the Finance Committee and
focus on provisions that expired, or will expire, between December 31, 2017 and
December 31st of this year – a total of 42 provisions.
Each
taskforce will be charged with examining temporary tax policies within one of
five identified issues areas. These issues areas are: workforce and community
development, health taxes, energy, business cost recovery, and a combined group
consisting of individual, excise taxes and other temporary policies.
We’ll
ask the taskforces to work with stakeholders, other Senate offices, and
interested parties to consider the original purpose of the policy and whether
the need for the provision continues today. If so, we’ll ask the taskforce to
identify possible solutions that would provide long-term certainty in these
areas.
That
may mean that the credit or deduction phases out over a period of years to
provide an affected industry a glide path to self-sufficiency.
In
other cases, it may mean that the provision could be scaled back, while still
providing a sufficient benefit for the affected industry or taxpayers, in
exchange for long-term certainty.
If
there’s little or no case for continuing the temporary policy, the taskforce
should consider whether the provision should be eliminated.
There
may also be provisions that the taskforce identifies that should be extended
without reform. For these provisions, the taskforce will have to consider
whether a continued short-term extension is sufficient to achieve the policy
goals, whether a longer-term extension is desirable to force a future Congress
to reevaluate the provision down the road, or if permanency is warranted.
This
is particularly relevant for the temporary tax policies relating to health
care. For these, we’ll ask the taskforce to focus on whether the tax policy
should be extended and for what duration. We’ll leave the evaluation of the
underlying health care policy to the health experts.
In
all, the taskforces will work to identify reform proposals, like those
identified for the short-line and biodiesel credits last year, so we can end
the policy of Congress kicking the can a year at a time. Or, in light of our
current predicament, the even worse policy of doing the kicking months after
the year has ended.
If
Congress is going to use temporary tax policy, taxpayers should be able to
count on it for the intended period. Moreover, the intended policy should be
clear so taxpayers do not fall into the trap of relying on a provision simply
because Congress has created the expectation that the provisions will be
consistently extended, even well after the fact.
Taxpayers
relying on these provisions have been doing what Congress wanted them to do –
investing in certain types of property, hiring new employees or taking other
types of actions. We shouldn’t punish them now for doing so.
Additionally,
we’ll have a sixth taskforce to examine the related issue of temporary disaster
tax relief. It will consider whether we should have a core set of permanent
proposals so taxpayers who’ve suffered through devastating disasters, like the
floods most recently in my home state of Iowa, don’t have to wait for Congress
to act before they can start rebuilding their lives, small businesses or farms.
We
have asked the taskforces to begin their work right away and complete their
efforts by the end of June. This should provide adequate time to identify
possible long-term solutions that can be enacted this year to end the annual
extenders drama and provide certainty to the taxpayers who utilize those
provisions.
We’ll
continue to work with the House to resolve the situation with respect to the
2018 temporary policies and to provide relief for all those affected by the
disasters in 2018 and so far this year. But we shouldn’t wait any longer to
start laying the groundwork to deal with all of these temporary tax policies as
permanently as possible.
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