Chamber urges Treasury to withdraw rules on inversions, estate tax: The U.S. Chamber of Commerce recommended Monday that the Treasury Department withdraw several Obama administration-era tax rules, including controversial guidance issued last year concerning offshore tax deals and the estate tax.
The Chamber’s comments come after President Trump signed an executive order in April that directs Treasury to review all significant tax regulations issued in 2016.
One rule that the Chamber wants to see eliminated is a Treasury regulation that would redefine certain related-party debt as equity under section 385 of the Internal Revenue Code.
{mosads}The Obama administration finalized the rules in October in an effort to limit the tax benefits of “inversions” — transactions in which U.S. companies merge with foreign companies and reincorporate overseas in order to lower their tax burdens.
But the Chamber expressed concerns that the rules would interfere with normal business transactions that have nothing to do with tax avoidance.
The Chamber also wants Treasury to withdraw guidance related to the estate tax.
The Hill’s Naomi Jagoda explains: http://bit.ly/2pE9OFy
House Budget chair to push for Medicaid changes: House Budget Committee Chairwoman Rep. Diane Black (R-Tenn.) says she hopes to get changes to Medicaid payments into next year’s budget.
“I intend to push for a change in the Medicaid reimbursement rate in our upcoming budget resolution to ensure that Medicaid dollars are used to properly support our most vulnerable citizens,” Black wrote in a RealClearPolitics op-ed Monday.
Black said Medicaid has a “faulty foundation,” claiming that states receive more federal dollars “to cover able-bodied adults above the poverty line who are on Medicaid than they do to support children and the disabled who are well below the poverty line. That’s wrong.” The Hill’s Niv Elis has more: http://bit.ly/2qp99VT.
Op-ed inspired Trump to move on tax reform: President Trump was inspired to take action on tax reform after someone in the White House flagged an op-ed by his former campaign advisers for him, Politico reported Monday.
In April, Stephen Moore, Larry Kudlow, Steve Forbes and Arthur Laffer wrote an op-ed in The New York Times urging the administration to advance tax-reform legislation “with urgency.” Someone in the White House alerted Trump to the piece, and Trump then told his staff to make a tax plan that resembles the op-ed, according to Politico.
One week after the op-ed was published, the White House released a plan that has a number of similarities to the recommendations from Moore, Kudlow, Forbes and Laffer. The Hill’s Naomi Jagoda explains: http://bit.ly/2qoUoSC.
Happy Monday and welcome to Overnight Finance. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.
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On tap tomorrow:
- Senate Banking Committee: Hearings to examine the nominations of Sigal Mandelker, of New York, to be Under Secretary for Terrorism and Financial Crimes, Marshall Billingslea, of Virginia, to be Assistant Secretary for Terrorist Financing, and Heath P. Tarbert, of Maryland, to be an Assistant Secretary, all at the Department of the Treasury; and Mira Radielovic Ricardel, of California, to be Under Secretary of Commerce for Export Administration, 10 a.m. http://bit.ly/2pG6k1u.
Sneak peek: House kicks off tax reform hearings, Treasury chief heads before Senate: The House is returning to Washington Tuesday after a week-long recess and lawmakers are quickly getting to work on their next big agenda item: tax reform. The House Ways and Means Committee will hold its first hearings on tax reform on Thursday. The hearing will focus on “how tax reform will grow our economy and create jobs across America.”
“Our hearing is an important step forward as we work with President Trump and our Senate colleagues on delivering historic pro-growth tax reform for the first time in 30 years,” Ways and Means Committee Chairman Kevin Brady (R-Texas) said.
The panel hopes to write and pass a tax reform bill – a top priority for lawmakers and President Trump – by the end of the year.
But the overall timeline is uncertain.
On Thursday, Treasury Secretary Steven Mnuchin will testify before the Senate Banking Committee, his first formal congressional appearance since his confirmation hearings in January.
Mnuchin is slated to discuss updates on the administration’s domestic and international financial policy. The secretary is likely to field several questions on how the administration plans to roll back Dodd-Frank, the recent economic cooperation agreement with China, and Mnuchin’s views on federal housing finance reform. I’ll tell you what to expect in our look at the week ahead: http://bit.ly/2qoYFFU.
Trump takes aim at drug prices: The Trump administration is working on actions it can take without Congress to fight high drug prices, according to people who have attended listening sessions officials are holding on the issue.
It is unclear what exactly the administration will do or how consequential the measures will actually be. But the prospect of changes is leaving the pharmaceutical industry, a powerful lobbying force in Washington, facing some unpredictability.
It’s a new circumstance for an industry that has traditionally been aligned with GOP administrations and members of Congress.
It’s now facing a Republican president who is on record as critical of the way they set prices.
The Hill’s Peter Sullivan has more here: http://bit.ly/2qKNeuX
White House will let small businesses bypass Healthcare.gov:
The Trump administration will allow small businesses to sign up for insurance coverage directly through an insurance agent or broker instead of through ObamaCare’s Healthcare.gov.
The change, slated to take effect for plans beginning on Jan. 1, 2018, allows small businesses to circumvent the Affordable Care Act’s Small Business Health Options Program (SHOP) marketplaces, which haven’t been very successful.
About 85,000 people from 11,000 small businesses are covered under the SHOP exchanges, though millions more were expected to participate when the program launched.
“Our goal is to reduce ACA burdens on consumers and small businesses and make it easier for them to purchase coverage,” said Centers for Medicare and Medicaid Administrator Seema Verma.
The Hill’s Jessie Hellmann explains the change here: http://bit.ly/2qoW9iT
Senators weigh bill to rein in costly regs: Lawmakers are expected to debate a bipartisan proposal to reform the federal rulemaking process.
The Senate Homeland Security and Governmental Affairs Committee will be looking at the Regulatory Accountability Act during its Wednesday’s meeting.
The bill, introduced last month by Sens. Rob Portman (R-Ohio) and Heidi Heitkamp (D-N.D.), requires federal agencies to seek public input before proposing a major rule – one with an economic impact of $100 million or more – and adopt only the most “cost-effective” regulation.
To adopt a “less cost-effective” option, an agency must explain the additional benefits from that approach, and the costs. The Hill’s Lydia Wheeler tells us more: http://bit.ly/2qoD9RB.
Supreme Court sides with nursing home in arbitration case: The Supreme Court sided with a Kentucky nursing home Monday in a case challenging the use of forced arbitration agreements in nursing home admissions.
In a 7-1 ruling, the justices said the lower court violated the Federal Arbitration Act when it declined to give effect to the agreements Beverly Wellner and Janis Clark had signed with power of attorney on behalf of their relatives.
When Wellner and Clark’s relatives died, they sued Kindred Nursing Centers L.P. for allegedly providing a substandard level of care, but the nursing home moved to dismiss the lawsuits, arguing that the arbitration agreements prohibited them from bringing their disputes to court. Here’s more from Lydia Wheeler: http://bit.ly/2qp1oPr.
The Economist rips Trumponomics: The Economist is blasting President Trump’s plan for the economy, saying it will leave the U.S. “more indebted and more unequal.”
The publication said the president’s plan “treats orthodoxy, accuracy and consistency as if they were simply to be negotiated away in a series of earth-shattering deals.”
“Although Trumponomics could stoke a mini-boom, it, too, poses dangers to America and the world,” it added.
The piece described Trumponomics as a “set of proposals put together by businessmen courtiers for their king.”
“Trumponomics is a poor recipe for long-term prosperity. America will end up more indebted and more unequal,” The Economist wrote on Saturday.
“It will neglect the real issues, such as how to retrain hardworking people whose skills are becoming redundant.” http://bit.ly/2qoBnzV.
Ryan: ‘Planets are aligned’ on tax reform: House Speaker Paul Ryan (R-Wis.) on Sunday said Congress is likely to pass a major overhaul of the tax code by the end of the year, but cautioned that Republicans “don’t want to put an artificial deadline” on reform.
“We don’t want to put an artificial deadline on tax reform because we want to get it right,” Ryan told radio host John Catsimatidis. “So this is really a plan for 2017, and we are convinced that we can get this done in 2017 so that the economy can really start to take off.”
“It’s a long time in coming, but all the planets are aligned, meaning you have the House, the Senate and the White House all working on this plan together to make sure we get comprehensive tax reform,” he added: http://bit.ly/2qoXXbw.
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