WASHINGTON – House lawmakers looking for an election-year boat in which to float their favorite legislation have started eyeing a corporate tax bill (search) that's urgently needed to stop an escalating trade fight with Europe.
Congress wants to pass the corporate tax bill this year because it would end punitive sanctions being imposed on some U.S. exports (search) to Europe. The sanctions escalate each month and punish the United States for not acting quickly enough to get rid of a tax break that international trade courts declared an illegal subsidy.
The pressing need makes the bill a prime magnet during an election year, when few other bills are expected to pass, lawmakers said.
"There aren't going to be many trains leaving the station," said Rep. Paul Ryan, R-Wis.
Republican leaders and tax writers must sort through the extras at the same time they work to shore up support for the bill's core tax changes.
"Obviously everybody is interested in this bill because everybody thinks it's a must-do bill and everybody wants their piece of it, and that's creating a problem in itself," said House Majority Leader Tom DeLay, R-Texas.
Some Southern lawmakers who want the government to buy out the Depression-era price support system for tobacco see an avenue through the corporate tax bill. Rep. Jack Kingston, R-Ga., said it's "the best vehicle we've seen this session to get something done."
Rep. Kevin Brady, R-Texas, said he secured a promise from tax writers for $4 billion to pass sales tax deductions (search) for taxpayers in states without income taxes. Current law lets taxpayers deduct their state income taxes, but not sales taxes, from their federal taxes owed.
Lawmakers have also talked about whether to use the corporate tax bill to extend expiring tax credits, including a business research and development credit, and to pass billions in new incentives for energy producers.
The Senate bill absorbed those tax cuts and dozens more.
House Ways and Means Committee Chairman Bill Thomas, R-Calif., said no decisions have been made about what to include or omit from the bill.
"Some people have gotten ahead of the parade," he said.
Thomas also expressed optimism that tax writers could use the Senate's overwhelming vote in favor of the bill to build support in the House for the package of revisions to domestic and international tax law.
Some House Republicans have been reluctant to vote for the international tax changes that might benefit multinational corporations and add incentives for companies to send American jobs overseas.
The Senate soundly rejected an effort to strip the international tax changes from their version of the bill, many of which exist in the House's bill in different form.