Weekly Legislative Update - December 9, 2019
Extenders Options Narrowing But Can Still Be Passed
On Saturday, Senator Grassley introduced three bills: one to lower the price of prescription drugs, another to revisit opportunity zones to prevent abuse, a third to strengthen multi-employer pension plans. See his press releases at www.finance.senate.gov, click on "Newsroom."
Where are WOTC and the other tax extenders? Stalled and reduced to finding a last-minute route to passage because the main actors, Senator Grassley and Congressman Neal, having begun talks a month ago, are unable to agree on expansive improvements to the Child Tax Credit and Earned Income Tax Credit that House Democrats want.
We're at a point where Congress' ability to act on the extenders is so limited we can only expect a temporary extension. This week ahead is the last for extenders' supporters in Congress to push for a lengthy temporary extension-Congress leaves on the 20th, waiting till the week of the 16th is too late.
Ways and Means Chairman Neal will be taking a tax bill to the floor next week. The bill is H.R. 3, "Lower Drug Costs Now Act," a high priority for Democrats. The extenders could be attached to this bill, getting them over to the Senate where the measure can be used as a vehicle, the prescription drug part being unacceptable to Senate Republicans.
If extenders aren't on H.R. 3, the House will debate three other non-tax bills and next week can pass without action. Then attaching the extenders to an appropriations bill will likely be our last resort in the House.
Our last resort in the Senate is broader because, in addition to appropriations, the Senate can use any tax bill already passed by the House as a vehicle for passing the extenders.
House and Senate appropriators are working this weekend to finalize all but one appropriations bill-the exception being Homeland Security, which is stuck over the President's request for funding a border wall. Until the appropriators report, we won't know how appropriations will be packaged for passage by the House and Senate, but with time running out, there's likely be a single omnibus to which tax extenders can be attached.
Senator Grassley and Chairman Neal know an election year isn't the best time to enact a major tax bill. Thus, an extension through the end of 2021 is the minimum we should be lobbying for in the Ways and Means Committee this week.
In the Senate, we have Senator Grassley's commitment to longer term extensions, so we should urge him and others on the Finance Committee to support an extension through the end of 2025, when several major provisions of TCJA expire.
We should emphasize that a temporary extension doesn't add to the baseline Federal deficit (because next year's revenue loss from the extenders is the same as last year's), so extension should be as long as possible for taxpayers to have certainty and stability in tax law.
TIA Pens Letter To Congressional Leaders Urging Prompt Action On Extenders
Below is a letter to congressional Leaders urging action on WOTC and other extenders:
Dear Leaders of Congress,
Taxpayers are facing the prospect of Congress ending the session without extensions of expired or about-to-expire tax provisions from 2017, 2018, and potentially 2019.
Clearly, there have been obstacles to Congress' ability to prevent this situation arising, but we believe you will agree a third year of failure to enact extensions is not sound management of the people's business.
In the case of the Work Opportunity Tax Credit, hiring of the urban and rural poor, veterans, long-term unemployed, people with disabilities, and disconnected youth will be disrupted at a time when approximately 28 percent of workers in the lowest ten percent of weekly wages are finding jobs via WOTC, according to DOL data.
Both tax-writing committees of the Congress examined the issue this year and agreed to cooperate in evaluating the extenders, making some permanent and granting long-term temporary extensions to others. When this isn't feasible, we urge that the right course is to timely enact temporary extensions of five to six years-a policy which doesn't require a funding offset.
Six-year temporary extensions will provide stability for tax credit programs, yield greater certainty for taxpayers, and allow Congress to evaluate, reform, terminate, or make extenders permanent by the time the tax code will be re-evaluated when individual tax rates under TCJA expire at the end of 2025.
Thank you for the opportunity to present this urgent matter, and thank you for your service to our country.
Tire Industry Association
Work Opportunity Tax Credit Coalition
U.S. Department of Labor Announces Extension of Comment Period for Proposed Rule for Tip Credit Provisions
On December 9, 2019, the Department announced an extension to the period for submitting written comments on the Notice of Proposed Rulemaking (NPRM) entitled "Tip Regulations Under the Fair Labor Standards Act (FLSA)."
The comment period now ends on December 11, 2019. The Department is taking this action to provide interested parties additional time to submit comments in response to an outage causing most web browsers to refuse access to www.regulations.gov for a period of time.
The Department encourages interested parties to submit comments on the proposed rule. The NPRM, along with the procedures for submitting comments, can be found at the WHD's Proposed Rule website.