Tax Legislation Facing Senate Opposition

Recent rumblings about the potential for the tax package negotiated by Rep. Jason Smith, R-Mo., and Sen. Ron Wyden, D-Ore., to see a vote in the Senate drew increased opposition from Senate Republicans.

Smith, the House Ways and Means Committee chair, and Wyden, chair of the Senate Finance Committee, introduced H.R. 7024 in January. The tax package is very narrowly tailored but includes in its provisions an exclusion of rules for the treatment of certain disaster-related personal casualty losses and exclusion from gross income for compensation for losses or damages resulting from certain wildfires. Notably in the latter, it defines qualified wildfire relief payment as any amount received by or on behalf of an individual for expenses, damages, or losses incurred as a result of a qualified wildfire disaster but only to the extent any expense, damage, or loss is not compensated for by insurance. The House approved the legislation Jan. 31, but it has not yet been set for a vote in the upper chamber.

NAMIC has been steadfast that the path forward for passage of a tax package is not likely, and comments by Sen. Mike Crapo, R-Idaho, the ranking member of the Senate Finance Committee, further solidifies NAMIC’s opinion. In a Feb. 28 statement, Crapo shared that “efforts to pressure Senate Republicans to rubber stamp the Wyden/Smith tax deal have been counterproductive,” listing several challenges he sees. Additionally, Sen. Tom Tillis penned an op-ed that appeared the same day in the Wall Street Journal calling for the Senate to reject the Wyden/Smith tax bill.

Tillis has been one of the most-opposed members of the Senate, and his op-ed reflects the sentiment. He emphasized one of his biggest challenges with the bill – that there is no legislative provision to pay for it – and that the employee retention tax credit “was never paid for to begin with.”