Having secured passage of their budget resolution last week, House Democrats are wasting no time in assembling the ensuing reconciliation package with tentatively scheduled markups starting as early as Thursday. It’s the start of an all-out sprint for Democrat lawmakers as they work to meet a host of high-profile September deadlines.

We’ll have a lot more clarity as the committees – particularly Ways and Means – make public their portions of the reconciliation package, but last week’s events at least give us a sense of the timing and roadblocks facing its adoption. Below is our commentary on those developments.

About that …

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The recent White House fact sheet on small businesses and tax hikes is highly misleading.  It exaggerates the number of small businesses in order to minimize the harm President Biden’s tax hikes will inflict on Main Street, it ignores many of the tax hikes under consideration, and it dismisses the economic importance of those businesses targeted for higher taxes.

The reality is that the tax hikes moving through Congress target millions of business owners, putting tens of millions of jobs in danger:

• Somewhere between 2 and 3 million small and family-owned businesses will be subject to higher taxes under the …
  
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This year’s leak of IRS tax returns has turned ProPublica into the accountant’s version of Robin Leach, host of “Lifestyles of the Rich and Famous”, whose exuberant and over-the-top narrative style made him the butt of innumerable jokes. Ostentatious! Wealth! Tax Breaks! It’s embarrassing.

The most recent example is their report highlighting how large family businesses are benefitting from the 199A pass-through deduction.  The article doesn’t claim that the profiled businesses are doing something wrong or that the deduction is a rifle shot that somehow benefits just high-income taxpayers.

No, the article focuses instead on how the deduction was implemented – …

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Senate Democrats released their FY 2022 budget resolution this morning.  With the bipartisan infrastructure bill scheduled to be voted on early this week, we could see final passage on the budget resolution no later than this Friday.  What does that mean for private employers and tax policy?

$1.75 Trillion in Tax Hikes

A budget resolution is a framework with lots of wiggle room built in.  That said, if the Senate follows the resolution’s headline numbers, the business community can expect to be looking at $1.75 trillion in new taxes over the next decade.  That’s a lot – one of the largest tax …

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