Transcripts For CSPAN3 House Ways Means Tax Reform Markup 20171107

Mr. Crowley. Yes. Mr. Davis. Mr. Davis, yes. Ms. Sanchez. Aye. Mr. Higgins. Mr. Higgins, aye, ms. Sewell aye, ms. Chu, aye, ms. Black. Mr. Rice. No. Chairman, brady . No. Chairman brady, no. Mr. Chairman. The clerk will record the vote. 16 yeas, 23 nays. The amendment is not agreed to. Are there any further amendments to the amendment in nature of a substitute . I have an amend at the desk. You have an amend . I do. Mr. Nunez. Point of order has been reserved. I ask the gentleman to suspend while the clerk distributes. Mr. Nunez, does the gentleman continue to continue his point of order . Recognized for five minutes. My amendment should be titled whats fair is fair, whats equitable is equitable. This amendment will eliminate the state and local Tax Deduction that corporations are currently allowed to deduct from their taxes. Just as the underlying bill is calling for the elimination of state and local taxes for millions of working families throughout this country, including just to show this isnt just an east coast west coast issue. Over 27 of the families in my large rural wisconsin district that itemize and take the deduction at an average tax savings of roughly 10,000. Mr. Chairman, i get what youre trying to do. This tax reform for the first time in 31 years is hard. In order to simplify the code, in order to reduce rates, youve got to take away certain expenditures, certain tax allowances that are currently in the code. I get that. Lets also be honest. The reason that youre going after the s. A. L. T. Provision and only applying it to working families is a revenue grab. A revenue grab in order to help pay for the complete elimination of the estate tax that many of you have claimed is a form of double taxation, when in truth, the estate tax is primarily unrealized Capital Gains that have never been taxed that are being passed on from generation to generation. Many of us have a problem with that. Also, the elimination of s. A. L. T. For working families is being used to completely eliminate the alternative minimal tax which is the only buffer we have in the code that have some of the most wealthy individuals pay some form of taxation at the end of the day. Including multibillionaire Real Estate Developers who own jets and yachts and huge towers named after themselves in new york city because we now know with a limited return that was revealed from mr. Trumps 2005 tax returns the only reason he paid any federal income tax at all that year was because of the alternative minimum tax you are choosing to completely eliminate which would be a huge windfall for people in mr. Trumps position. Its also being used to pay for a 44 reduction of the marginal Corporate Tax rate in our tax code. 44 reduction in the rate. And so were saying and what were trying to do is make it easier for you to pay for this bill and the 2. 3 trillion shortfall that you currently have. With this underlying legislation. Lets treat corporations like the people that they are according to recent Supreme Court decisions. And treat them the same way as youre treating other working families throughout the country. We think thats fair. We think thats equitable. Quite frankly, in order for you to be able to solve this back home for the rest of the American People there has to be sentence of fairinoness in what were doing. If they think this bill is nothing but a sop for the most wealthy and large corporations at their expense, the political will back home in our district is not going to be there. Its that plain and simple. Right now you have an optics problem. So much of the relief is being delivered to multinational corporations at the expense of working families. And so much of the relief is being addressed at the tom throu top. That there is an optics problem. On top of it you dont pay for it all. 2. 3 trillion in additional debt. The one industry thats the primary beneficiary of what youre calling for today are the large wall street banks. The same very banks that put us to the brink of financial ruin as a nation back in 2008, 2009. And they, especially, will benefit from the provisions that youre offering for the American People today. So all were saying is whats fair is fair, whats equitable is equitable. If youre going to do the revenue grab from millions of working families with the elimination of s. A. L. T. Lets ask the corporations of america to also give up that deduction that they are currently allowed to take. In fact, id entertain a friendly amendment on your side if you want to eliminate the foreign tax credit which allows multinationals to deduct the taxes they pay by moving operations overseas and operating in other countries, there would be additional revenue we could raise to close the 2. 3 trillion gap. I think its reasonable, fair and it helps in so many ways the optical problems you have with underlying legislation and it makes more sense to working families who are being asked to give aup the state and local ta deduction and say were all in this together, including the large corporations of this country. I yield back. Mr. Nunez is recognized to speak on the amendment. Mr. Chairman, i rise in opposition to this amendment. Coming from the highest taxed state in the nation, i just i want to continue toed a vkt that if we continue this deduction, it mostly goes for really rich people, especially in california. Youre talking about millionaires and billionaires from Silicon Valley, hollywood producers, really wealthy people who are taking advantage of the s. A. L. T. Deduction of everyone else in the country. I would advocate voting against the amendment. I hope all of my colleagues would vote against this amendment. I say that from somebody who comes from the most taxed state in the nation. Just a few days ago we raised our gap tax so well be the highest gas tax in the United States of america. Even higher than hawaii. Even though we are one of the largest holders of oil in the United States. So i asked my colleagues to vote against this amendment and send a strong message to state capitals around the country that want to continue to raise taxes on the American People and on their would the gentleman yield to a question . Mr. Nunez controls the time. I heard what you were saying, im trying to get the connecting link. Why, if its wrong, and you want to get rid of it, why are you speaking against mr. Kinds amendment which would just treat businesses the same way you want to treat working families or rich working families . Because as you know, we allow for businesses all over the country, theyre all treated the same. Theyre all on the same Playing Field. They all can deduct business taxes and that should continue. And why you would get rid of that. Why would you take it away. The gentleman from california, controls the time. Thats why. You have another question . One clarification. The thing im missing is if you think it is wrong for individuals, why would you allow corporations to continue to take that deduction . Its not just corporations. And you take it away its all businesses in the United States who take advantage of this and theyre all treated the same all over the United States. If you begin to mess with that, youll have huge distortions in the marketplace. But as someone who pays taxes in california, we have the highest taxes in the United States, i do not think its okay to allow politicians in sacramento to deduct those taxes. With that did somebody else want time over here . The gentleman yields. Mr. Crowley. What affect will this have on the state taxes . If youre moving it from if allowing states im sorry for corporations are to continue to deduct but not individuals, what affect will this have on state governments if individuals can no longer deduct and corporations can . The point is is that if youre going to change people are tired of paying this. The gentleman controls the time. Look, this is a perfect time for me please, mr. Chairman. We have fallen into the habit of interrupting nearly every speaker in some way. Heres my recommendation. Allow members to complete their statements, then when finished if you wish to for the most part we ought to be respectful of each others time. Mr. Nunez. I would continue to reclaiming my time i will continue to make the point that were giving advantages to state capitals to raise taxes on citizens. Thats whats happening. So if you continue to allow sacramento to deduct, theyre going to continue to raise taxes on californians on my constituents. The fact remains, as i stated earlier, these deductions go to the wealthiest people. If you are advocating keeping s. A. L. T. Deduction for states, youre advocating for the richest citizens in your state. Thats just a fact. If you went to businesses, like you want to do, i cant imagine that this would actually pass if you were serious about this amendment. This is designed to kill the bill. I want to make sure, mr. Chairman, im on the record as opposing new taxes for california and getting rid of s. A. L. T. Does that. Gentleman yields his time. Mr. Neil youre recognized. I support the kind amendment and i support it because i think it calls attention to the grievance we feel on this side, where you are subtracting a benefit for middle class people across the country, in terms of state and local Tax Deduction, while simultaneously not addressing it in an equitable manner. Once again,ier will repeat, were repealing the estate tax. Were repealing alternative tax for the families that now pay it. And we cant bring ourselves to say they should keep their Tax Deduction. I would say to my friend, mr. Nunez. Im not sure of what happened and how the gas tax was raised. When you live in a state where one out of eight people in america reside, it strikes me that the state has done very well over my time in terms infrastructure expenditure. I look at whats happened across thereat state, i think were talking about equity and fairness. Were repealing the estate tax, alternative tax for 4. 5 million people. And estate tax, 5,000 families next year will be asked to pay the huh staestate tax. Were taking the middle class estate tax break away . Im sorry. Yield to mr. Thompson. Thank you, gentleman, for yielding. I want to point out that in my district, 40 of my constituents use this deduction. It means about 15,000 to them. According to my friends logic, he wants to reduce their tax burden. Youre increasing the tax burden on folks in my district. 24 of your constituents use this deduction. By repealing it, its going to cost them about 10,000 each. You are, in fact, increasing the tax burden on middle class folks surely, wealthy people take advantage of this, too. This is something that middle class americans can take advantage of what mr. Kind is doing,ser trying to bring equity to this issue. Were going to repeal it for working class, middle class americans. And allow their tax burden to increase and keep it for businesses. I cant understand why we would treat them differently than we would treat people on your side of the dias has claimed youre trying to help. This is not a help. If mr. Kinds amendment were to be accepted it would be equal treatment across the board. And we should either treat folks equally or we should be honest about what it is that yall are doing. And i yield the rest of my time to mr. Blumenour. I appreciate mr. , nunez, being involved with back and forth. I was truly trying to clarify. But the clarification didnt help me much yes, it would apply uniformly across the country. Mr. Kinds amendment would apply uniformly across the country. All businesses would be treated the same way you want to treat working families. Its not just rich people. I have 40 of the people in my district who claim this and theyre not quite as wealthy as mr. Thompsons folks in the napa valley. But its 13,000. Stop it. I want his words taken down. Theres no reason to not treat businesses the same as individuals. Until give me some help here. Mr. Kind is trying to have uniformity across the country, and not tilt this even more against people who dont need the help. Youve concentrated the business at the top. Youre going to make it worse by getting rid of the inheritance tax for a few hundred people a year. Youre going to punish families and not have businesses treated the same. Thats absolutely incomprehensible to me. Time is expired. Mr. Smith. Thank you, mr. Chairman. Its interesting listening to that exchange here and the dialogue. I thought nebraska was a high property tax state at the beginning of the debate and i learned there are other jurisdictions that are even higher. Shocking as that might seem. I look at the overall tax burden, the ublability to pay. I represent an agricultural district. I cant imagine saying, well, lets put these taxes discontinue the deductibility. I assume just to clarify, mr. Kind, if you would yield your amendment would place agriculture land along with all other businesses consistently sne. Would this apply to corporations in the agri Business World . Even family farms. Because of the expensing theyre allowed to do every year and the depreciation theyre allowed to take. Their Tax Liability usually isnt that large to begin with. At least in nebraska the property tax burden placed on agriculture is significant. As we look at our goal, our objective of this entire effort to grow the economy, grow opportunity, grow the number of jobs, i think its important that we continue in this direction and this amendment stands in the way of that. I know there are efforts to continue the estate tax that is a double tax. Thats unfair at any level, at any rate, at any exemption. Its still unfair. Its going to hit small businesses. Some would say not small enough. Thats not a good argument. When were looking to grow opportunity and expand the kissimmee. Its interesting that the chairman of gallop has said a while back that its not government that creates jobs, in fact, he would argue that its not even employers that create jobs, its customers who create jobs. This tax reform bill is about creating more customers. Its not about washington choosing, okay, which narrow group can we give this benefit to and this benefit to and this benefit to. Its about broad based relief and weve heard that confirmed in terms of folks all across the spectrum being able to benefit. When folks all across the spectrum benefit, that creates more customers and those customers create more jobs. Thank you, i yield back. Mr. Levin. I hope everybody is as confused as mr. Blumenour is. You said its confusing because were repealing the deduction for state and local taxes for individuals. But not for corporation. Why are we doing that . Mr. Nunezs answer is that all corporations are being treated the same but that doesnt answer the question why are you making a distinction between the individual and the corporation . The family farm is an individual. So whats the answer . You say you want to do this because the estate tax people, income tax people individually too high. You want to discourage that. Why doesnt nat logthat logic a to state taxes and corporations. I think somebody should answer what is the logic for in this deciding that individuals cannot deduct their individual state and local taxes. They can the property taxes. But letting corporations do it. Ill yield to anybody who wants to explain that. Mr. Nunez, ill yield to you explain why individuals cannot but corporations can. Whats the answer . If the gentleman will yield. I will. Youll have chance to vote on this amendment. Im going to find it hard that you are advocating on your side of the aisle, youre advocating keeping this Tax Deduction that is guaranteed to get to the most richest americans in the United States of america. As you know, businesses dont have votes. And so if youve you really want to treat businesses differently, we can entertain this. If you would like this to pass but i dont believe you really want this bill to pass. Two things, first thing for this amendment, i apologize. This issue doesnt relate only to the very richest. I think you should stop saying that. Because youre using our attack on your bill as applying mostly to the very wealthy compare today the person thats in the middle class and the facts show were right about that. So then you try to twist it and say okay, be consistent. Because youre worried about a bill that essentially gives the biggest break to the very richest, while the this amendment essentially relates to the very richest when it doesnt. It applies to the very richest. And lots of other people. So why do you keep saying that . Why do you keep saying that . I think youre so desperate to get a bill passed that when we point out logic, we point out unfairness, you just kind of duck it. Tell me why businesses should be in a separate category than corporations to being a separate category from individuals . Somebody on your side say that, somebody if the gentleman would yield . Yes. You know, businesses pay taxes on their profit, right . And what they have to do is compete what their profit is. And section 162 of the Internal Revenue code says that in determining profit they shall deduct all reasonable and necessary business expenses. Okay, but the tax one of the business expenses is taxes. So if you take taxes away, then you are distorting what the mr. Levin controls the time. Im glad to have back and forth. Let me just respond. The tax code also says thereat individu individua individuals can deduct what theyre paying in state and local taxes. Thats what the code says. The same for businesses. And my question let me finish. Mr. Chairman, remind the chairman of the interrupting. Hold on. Mr. Levin controls the time, restore it for 15 seconds. You dont answer the question. Why corporations should be treated differently than individuals . Maybe taking away from individuals raises more revenue. But give a response. Give a rationale. I yield back. The gentlemans time is expired. Mr. Wright. Thank you, mr. Chairman. You know, its fascinating to me that in the face of all this evidence and all these studies that have been done already on this plan, you know, again, let me ask you, in every quintile of Income Distribution in america, when this plan is taken into account, the tax reduction, the rate reduction, the increase in the standard deduction, the elimination of s. A. L. T. And all these other components of this plan, what is the tax effect on every quintile in the of the american taxpayer . Mr. Rice has reported across all our income categories, on average, theres net tax reduction theres a tax reduction. So, you know, i will toward the end, let me finish and make my point. You know, we continue to say that theres going to be a tax increase, when, in fact, its not just the joint committee on taxation here, but its alsowhet just mr. Bart hold and the joint committee on taxation here, but its also the tax foundation, its also the Washington Post has issued statements saying that in every level of income in america they will receive a tax cut. You know, the folks back home, i dont think they really care if their tax cut comes from writing off state property taxes or if it comes from a reduction in rates or if it comes from the standard deduction. What they care about is, first of all, they want this thing simplified where they dont have to hire accountants for 100 an hour to figure out how to comply with the law and not go to jail, and the second is they care about playing as little as they can to the government, having as little flesh as they can exacted from the government. And finally, going back to this to this amendment, where you propose here to take away from businesses, it says, all business organizations the ability to write off state and local Tax Deductions in calculating their profit. So what would the effect of that be . The effect of that would be that the tax rate on the business would go up. Well, you know, gosh, here we sit right now, we havent had tax reform since 1986, its been 26 years now or, excuse me, im counting wrong 31 years now and at that time our tax code was pretty competitive, but since then pretty much everybody in the world has left us by. The average tax rate for businesses in the world now is about 20 , thats what were trying to get down to. Were trying to get down to at least be competitive, and this amendment wants to raise taxes on business, which is, you know, pretty ridiculous actually because what were trying to do is be competitive. What were trying to do is stimulate the economy rather than hold it back. What were trying to do one more time is to create jobs and to restore this as a land of opportunity and what you want to do is a disguised increase in taxes on all business organizations. You know, i dont think the folks back home would like that. I think the folks back home understand that theyve seen americans jobs going overseas. That was one of the reasons why donald trump got elected. Carrier was leaving ohio to go to mexico. Why . Because of tax rates. And what you all want to do, what youre proposing here is to take away one of their reductions and raise their rates. The whole purpose of this bill is to try to get back to over or at least to average growth what we have had under every Single Administration since world war ii until barack obama and since then weve averaged about 2 or less and weve left a generation of folks coming out of college behind and instead of lowering taxes, which is what our bill proposes to make these Companies Competitive so they can create jobs and raise wages for middle class america, you want to raise taxes on businesses and make them less competitive. And then you get up there and say that our business in spite of everybody thats looked at the doggone bill and says that it will lower taxes for the middle class, you continue to push the false hood that it will raise taxes on the middle class. I dont know, we are just talking over each other. I yield back. Mr. Larson. Thank you, mr. Chairman. I yield 30 seconds to the gentleman from mr. Rice, you said a false hood. Mr. Barthold used the word average and he gave us a chart and everybody should look at it. A that in the year 2025 there will be an increase in taxes for 21 of people who are making 75,000 to 100,000 and 26. 7 for people making 100,000 to 200,000. So just look at the chart. In fact, so that everybody has it, im going to distribute it now to everybody this chart and i think to the media so that you understand whats true and whats false. I thank you very much for yielding. I thank you, mr. Levin, for bringing further clarity to this discussion and i thank mr. Kind who i associate myself with in my comments and at the beginning he he talked about his amendment as being whats fair is fair and my grandmother used to have a saying whats good for the goose is good for the gander, but what we see in mr. Kind the reception to mr. Kinds amendment is, no, thats not the case because this bill has been distorted and weighted where it takes money from states and people in the middle class in states and transfers it to major corporations. So mr. Kind has said, well, lets balance that off. Why is it that its fair to take a s. A. L. T. Deduction away from people who itemize their deductions but still let corporations keep it. Mr. Neil responded by saying, come on, how can you further along with that also further weight it by getting rid of the amt tax and also getting rid of the estate tax as well . And so it becomes a very lopsided argument that mr. Kind is trying to bring clarity to by saying whats good for the goose is good for the gander. Lets make this fair and if corporations, you know, are getting the breaks that they are shouldnt we try to level the Playing Field . So all those middle class families, and we will have amendments later on to see if joint tax will guarantee that all middle class families will receive a tax break and it will be subject to the longterm ramifications of that. And with that i will yield to my colleague, mr. Kind. I thank the gentleman for yielding. Guys, this isnt complicated. This amendment is trying to help you with the optical problem you have right now by taking away state and local Tax Deduction for millions of working families and saying, hey, were going to be fair and were going to ask corporations to chip in, too, and treat them the same way. They are after all personhoods now according to the Supreme Court but more importantly you have a 2. 3 trillion hole that needs to be filled. This is one way to help fill that. You guys got a bird rule on the senate side thats going to smack you in the face because they are not going to be able to deliver what youre trying to offer the American People in this bill because of the budgetary rules out there. And get ready to get stabbed in the back by the senate, too, with the corporate rate that theyre going to come up with because that knife is coming and we all know it is. Lets also be honest that the former republican chair of this committee recently introduced a comprehensive reform that was all paid for that called for a corporate rate at 25 and not 20. Because he felt that that would enable them to be competitive on a global scale. And do you know what, i think hes right. Going from 35 to 25 is a generous marginal rate reduction for corporations in this country and it makes them competitive with the oecd nations where you guys conveniently ignore the vat and the carbon tax that these multinationals are also subjected to, along with the corporate rate that theyre living with overseas. By the time you make those tax adjustments, 25 is looking pretty darn generous. And that would go a long ways of closing the 2. 3 trillion hole that you have, but also going home and being able to look these families in the face and say, do you know what, were asking to chip in for the sake of simplification so we are lower cates double the standard deduction and asking Corporate America to do the same thing. When you exclude them from the business theyre doing here and abroad you have a political problem and thats showing up in all the polling and all the feedback were getting from our constituents and the calls that are coming into our office its right now. Im not trying to be cute or fansy or malicious with this amendment, im trying to make why you are job easier when it comes to tax reform knowing whats coming up in the senate in very short order. Mr. Renacci. Are itemized deductions interest property and state taxes, medical expenses, charitable contributions, miscellaneous deduction, investment interest, is that the list of itemized deductions . Those are the major ones. I mean the miscellaneous has within miscellaneous there are a lot of things. On a tax return a taxpayer lists all of those items and today under current law if because somebody on this committee, whether its 50 years ago, 100 years ago whenever the tax code was written decided to simplify it, they said if you get to 12,600 which is the standard deduction today, that when you list all of that as long as you you dont exceed that we are going to give you that deduction, is that correct . Thats the way thats the way the law works. Thats the way the law works today. So somebody on this Committee Years ago said we want you to come up with those deductions but when you get if but if you dont get over 12,6 then you dont even have to keep the documentation, were going to give you that deduction. So today 70 of americans im going to use your number now 70 of americans dont itemize because they dont get to the 12,6 because we replace all their miscellaneous deductions with the standard deduction, is that correct . Well, not just the miscellaneous deductions, the other deductions you named. Right. So when we double it, 95 of the people dont have to worry about itemizing because weve replaced that, correct . Yes. Thats your number. So weve actually benefited by this law 25 of the people who have not gotten a deduction, weve actually benefited under this law by doubling it and taking it to 95 , would you agree with that . Well, some mr. Renacci, some people would be a wash. Right. And you do leave its a little its probably a little more subtle than that because you do leave itemized deductions for mortgage, charity and property tax, so theres still the choice to make. So people that previously had been claiming, lets say, mortgage interest deduction, charitable deduction, property Tax Deduction and other Tax Deductions, then it depends what have they lost relative to the increase in standard deduction and making that choice between the two. Right, because the standard deduction is much higher. So they are theres 25 of the people now will the gentleman yield . Not at this time. Let me finish. Im trying to get to a point. So theres 25 more people that are getting a deduction based on those numbers, correct . Its clearly more people will elect to choose the standard deduction. Over all these itemized state and local tax and everything else. So this bill actually helps 25 more people. So we have actually not i keep bringing this up. We are not eliminating deductions, were replacing it with a higher standard deduction so many of these individuals will not be able to take this deduction and by the way, 25 more will be able to get a deduction that they wouldnt be able to get on average, is that correct . Thats certainly true of the standard deduction. Exactly. So weve got to get off of this that we continue to take a deduction away. We have not taken a dee dks away. Weve replace it had with a greater itemized deduction. Mr. Kind, i guess what i would ask you this is interesting because i heard you say equal treatment, fair is fair, level the Playing Field, business as well as individuals. Are you willing to give the businesses a standard deduction . Thats fair. Thats equal treatment between individuals and business. I will take that deal. If you want to apply this doubling of the standard deduction to Corporate America lets do it because that 2. 3 trillion would disappear overnight if we did that. We need to look at that. If you want fair if fair youve got to give businesses more importantly lets have some hearings and actually discuss this because this is where it gets complicated. This is something thats lacking before this committee today is that type of feedback. Whats interesting is whats fair is fair, whats equal treatment, whats level the Playing Field, these are all the words that members my members friends from the other side said, business as well as individuals. If youre going to come up with an amendment like this and you want it to be fair then youve got to come up with a standard deduction. So i oppose this amendment because this is a one sided amendment. Come up with a standard deduction that makes it fair is fair, equal is equal, level the Playing Field, business as well as individuals and maybe somebody on this side i would be happy to work with you on that. Gentleman yield . Mr. Crowley. Ms. Suell. Thank you, mr. Chair. So id like to attempt to answer the question that my colleague that our colleague sandy levin asked. Why is it that our colleagues on the other side wont answer the question why are you willing to give middle class families take away their state and local Tax Deduction but not willing to do the same for businesses . As i said in my opening statement, this is about values. What do you value . And, sandy, what theyre saying is that they would rather value businesses over middle class and working families. And thats unacceptable. You know, if you look at the fact that we are choosing winners and losers in this tax code and what were basically saying, sandy, is that the winner should be the businesses and not individuals. Not the hard working people that we represent. And its unacceptable. You know, i know that i represent one of these recipient states not a donor state. The state of alabama receives almost 2 for every 1 we get from the from the federal government, but even my district, which is a relatively poor district, would benefit from not being doubly taxed on their state and local deductions. In fact, in my district 28 of the taxpayers use the s. A. L. T. Deduction and the average s. A. L. T. Deduction is around 6,348. And i can tell you that my hard working folks that i represent, they would love to be able to continue to deduct that from their income tax, and its unfair that we are placing a burden on middle class and working families that we are not willing to do the same on businesses. Look, i represent Big Companies as well. I think what were saying is equity and fairness here and i think that congressman kinds you know, rons amendment is a fair amendment, it really gets to the heart of why it is were talking about it. Were making value judgments here, colleagues, value judgments and my values are with the people that i represent and those hard working folks deserve to have a break. So, you know, i also dont understand why my colleagues on the other side would not choose to do this when it would conceivably raise way more revenue than, you know, not allowing the deduction on state and local taxes. So i ask, mr. Barthold, what effect would it be on revenue if we leveled the Playing Field and we required businesses to not be able to deduct state and local taxes . Well, first order of fact would be it would increase business tax liabilities, it would also change a lot of economic but wouldnt we raise more money . If this is about revenue generating, you know, theres a 2. 3 billion trillion dollar gap here in our colleagues across the aisles assessment in this bill, so 2. 3 trillion gap, deficit. Wouldnt we raise money by i said we should raise money. We have not done the analysis of how much that might be. Okay. But it would be higher than probably what the analysis is for individuals which is 1. 5 . I could not make a judgment as to the size. It would increase corporate it would increase business tax liabilities so it should raise money. Look, the bottom line is that were making value judgments here and its really, i think, woefully unfair to put the majority of the burden of paying for this 2. 3 trillion give away to the wealthiest 1 in america to put it on the backs of hard working folks. Will the gentle lady yield . I will yield. Mr. Bart southeast hold i would like to ask you this because weve heard constantly from inside this analysis and i keep on turning to you, let me ask you this just because people no longer would be able to itemize, just because they would no longer and thats what the question assumes that this bill would go into law and they would no longer be able to itemize, does that mean that they would be as well off as they were under current law under all circumstances . Or is it a mixed bag . No, sir, as we discussed yesterday theres many moving pieces in the overall reform of hr 1. So if youre just comparing thats what i thought you were getting to. All theyre saying is this just means that this is the only remaining option. Mr. Is that biker. Thank you, mr. Chairman. And this may be one of those moments where i actually want to think through this, mr. Kind, and i may come across a little bit disharm nous to my brothers and sisters on both sides. Lets think this through and lets just use a simple example and let me first off point out, i used to be the Tax Collector for the fourth most populous county in the United States so i have a little bit of experience particularly in the property tax world. So i walk into my local Grocery Store and i buy a loaf of bread. In that loaf of bread are the costs from the Grocery Store, property tax is part of that. If youre already telling me if part of the argument coming from the left is that we have an unusual distribution of state and local taxes in some areas being much higher than other regions of the country, did you also just through this amendment make the decision that if that higher property tax, higher income tax that a business right now would be taking out of that loaf of bread because they can deduct it, did you just sort of double down on what you were arguing was a distributional problem in parts of the country . Look, for someone being from arizona which is a moderate property and income tax state, so business would actually book its profits in the most marginal state for its income tax, but a heavy user of real estate like Grocery Stores in your community cant sort of do that type of state chartered shifting for its profit. So it would be picking up its property tax particularly there and by losing its deductibility wouldnt you be in many ways just doubling up on your very argument you had before . Look, im just i understand both the concept of making an intellectual point and now im just actually trying to walk through some of the math because part of me says maybe we should at least conceptually set this aside if we need a future pay for, but do understand the doubling down impact youre going to have on those very high tax communities. The gentleman mr. Kind, please, because as you know you are one of my favorite people on the committee because i believe you to be very intellectually sound on this. Be careful, kind words you say now can come back to fight. You it wont be the first time i get a democrat in trouble. I appreciate your thoughtfulness on this issue. This is where it gets complicated, mr. Chairman, which is exactly where we ought to do it the right way and have experts come before the committee and walk us through and explain the ramifications of what were doing here rather than closed doors late at night scribbling something in for the sake of a political victory. This may be the one that i can be your expert on because i did this for aing lo time and i was worried about mr. Larsons folks buying a loaf of bread because we may have just really raised his costs, but you may have just shifted mr. Larsons businesses to the beautiful state of arizona. So with that, mr. Chairman, i yield back. Mr. Paxrell. This is a move to strike the last word. This to me, mr. Chairman, is really a double standard. I mentioned it in the previous amendment, i mentioned it yesterday and i mentioned it last week. This amendment by mr. Kind i believe would prevent a double standard favoring businesses over the middle class. Now, thats a pretty simplistic statement, i will admit, but when you look at the numbers, you see how much revenue was gathered from each of these deductions, i think you would want to avoid that as well. So were saying to families and correct me if you think im wrong were saying to families that were going to take this deduction away from you, the ability to use this on your federal taxes, and, by the way, mr. Chairman, youve caught it as well as i, the underlying tones of some folks that are speaking here today about the higher tax states. Theres a reason for that, mr. Chairman. Do you want me to go into that which has very little to do with mr. Kinds amendment, but ive caught it and i dont like it. At all. It has no place here. Talk about one america. We should be one america. But were saying to families that you cannot deduct these local taxes and these state taxes which weve been doing since the civil war and the reason why you cant do that is were going to take we dont need that because were going to take care of you in doubling the standard deduction, et cetera. I think i put a little a few holes into that yesterday about where do we gather more money. So were saying you will have enough money here, you dont have to worry about losing any money, but then we say, well, corporations can keep on doing this. Now, to me thats a double standard. Mr. Chairman, can you explain to me how it is not a double standard . Mr. Chairman . Mr. Pascrell, please continue with your statement on the amendment, please. I had a question. For purposes so once you finish your statement at some point i will be glad to chime in on it. I just finished. Thank you, mr. Pascrell. Time has expired. Can i will you answer my question, sir . So having just sat down for a moment, if i may, i want to make sure mr. Barthold, would you answer the question . Since the chairman does not want to answer the question right now feel free to jump in here, tom, anytime you would like. Since he just sat down. Actually i was a little confused. Could you repeat your question, mr. Pascrell, and i will try to answer it. Isnt it a double standard if were asking families to give up the stability to deduct a deduction thats been available to them since 1863 and were asking corporations as i understand it as i understand it that you dont have to do this. Were doing it were doing it for families because were going to make up that money that theyre not able to deduct by doubling the standard deduction. What are we saying to corporations . Help me understand this, mr. Barthold. Well, i can explain the principle behind the deduction for businesses for expenses that they incur in earning income is youre trying to measure the income of the business after all costs, all usual and reasonable costs. Right. Thats the standard that is applied. So its a different standard than for families using that deduction, is that correct, mr. Barthold . Thats the standard for business. And that has been the standard for 100 and some odd years. Remember we havent had an income tax quite all that right. I understand that, mr. Barthold. You know what im talk being. In terms of measuring business income that has been the standard pretty much for that time, that all reasonable and usual costs of engage in business are deductible at arriving at the income of the business enterprise. Thank you. All time has expired. Mr. Bennie, you are recognized to speak on the amendment. Thank you, mr. Chair. We actually had this conversation yesterday, mr. Barthold and i want to highlight it again because i think some of my colleagues are still struggling to understand why this amendment is so important. I asked you ned if a firefighter in my district would be able to deduct the state and local sales taxes that she pays from her tax returns and lets say today can she do that . You are from the state of washington, there is no income tax that individual state and local sales taxes is actually what i said. He lake effect the sales tax election. Okay. If the total itemized deductions exceed the standard deduction amount yes, she can deduct those today. Thats correct. But under this plan will that firefighter be able to deduct those sales taxes . She would not. Okay. So this changes. She has lost the ability to deduct those sales taxes from her federal income taxes under this plan. Thats correct. So will a corporation be able to deduct sales taxes on business purchases under the or today . Today can a corporation do that today . As a general matter, yes. In fact, many businesses thats fine. Sales taxes so if they can today, now, will they under this plan be able to continue to deduct that . Yes. So for the firefighter she cant she could deduct those sales taxes today, she wont be able to under this plan for the corporation they can today and they still can under this plan. In fact, the corporation also gets a 15 tax cut. 15 . So when we talk about legislation does this legislation the that we are talking about treat corporations and individuals the same . The answer is no and here is a good example why will the gentle lady yield . Please let me finish. No, they are not actually the same. Corporations are getting 15 tax cut and they are in addition able to keep this deduction on state and local taxes, but the firefighter in my district isnt getting that. In fact, a lot of the things that might impact the firefighter in my district will also expire in five years whereas the corporate reductions that are in this plan are permanent. So this is not about parity today, what this amendment, though, is about is trying to make one step towards parity, make sure that businesses, corporate corporations are treated the same as individuals and families based on the changes that are being made in this bill. So its just really disappointing that weve heard a lot of a lot of talk on the other side of the aisle but the reality is there is a benefit that people take advantage of today, people in my district take advantage of today, thats going to be lost, but for companies that benefit is not going to be lost. In fact, theyre also getting 15 sales tax or a 15 Corporate Tax cut. I want to yield to mr. Neil. Mr. Barthold, just because people no longer itemize does not mean that they are as well off as they are under current law, it just means that thats their best remaining option. Im going to pursue this later on but i would like you to maybe give a fuller answer to us. No, thats correct, mr. Neil. As i was explaining, theres multiple things you have to trade off. It is i guess we should step back and understand again what the decision that the taxpayer faces is and thats under present law theres certain items that you may be permitted to deduct, if the sum of those items exceeds the standard deduction you would wisely choogs to itemize those items and if its less you would wisely choose the standard deduction. Under hr 1 the number of items that you compare to the standard deduction has changed. So depending what your itemized deductions were under present law compared to standard deduction under present law, compare the sum of itemized deductions that are permitted under the reform proposal compared to the standard deduction that is permitted under the reform proposal you would make the decision to itemize or not itemize. What i reported is you as you had just asked was that more people will choose standard deduction under the reform proposal. That doesnt necessarily mean that the total amount that they get to deduct from their adjusted gross income right. Is the same. It doesnt mean theyre necessarily better off. Some can have fewer total deductions, some will have more total deductions. Time has expired. [ inaudible ] is recognized to speak on the amendment. Well, when i heard the gentleman from california say that the s. A. L. T. Deduction only benefits rich Silicon Valley executives and hollywood producers i could not believe my ears. In reality the s. A. L. T. Deduction benefits a wide variety of people, in fact, almost 40 of taxpayers making between 50,000 to 75,000 per year use the s. A. L. T. Deduction and more than 70 of taxpayers earning from 100,000 to 200,000 per year use the s. A. L. T. Deduction. They dont sound like rich hollywood producers to me. And, in fact, the Government Finance Officers Association just did an analysis of the most recent version of the s. A. L. T. Deduction compromise and they looked at an average family of four who owns a home and earns between 50,000 to 200,000 and theyve found that all 50 states would see tax increases and california would be the hardest hit state with an average tax increase of 26. 4 . Congressmen nunez, in your own district 24 of the people in your district use the s. A. L. T. Deduction, a deduction of 9,844. They dont sound like rich hollywood producers to me. Now, the Government Finance Officers Association says that even if congress were to offset impacts from eliminating the salt deduction from increases in the standard deduction, the deduction would need to increase significantly. Even if it were to double or triple a significant portion of taxpayers would still end up with tax increases. Any way you look at it the elimination of s. A. L. T. Is a raw deal for the middle class. Would the gentle lady yield . Right behind you. Oh, yes. I yield. I thank you gentle lady for yielding. I couldnt agree with her statement more. Even in my large rural not exactly rich district in wisconsin over 27 of my constituents are itemizing and taking this state and local Tax Deduction. These are not hollywood producers, these are not high tech cheertons these are normal hard working families trying to figure out the best way to make it all work for them. Again, when you look at the equities involved and the perception thats being created out there its going to be awfully hard for me to explain no those families why their deduction for state and local taxes are being eliminated but large corporations many of whom arent paying any tax toss begin with because of the itemization that they have are able to it be and continue to deduct state and local taxes. There is a problem with the perception of all of that. I would also submit that the reason were stuck at 20 right now in the corporate rate is only because President Trump started the bidding at 15. And i think to the chair and this committees wisdom you realized thats going to cost too much. We would have deficits as long as the eye could see and there is no way we could accord a 15 rate, we are up to 20, but the truth is your predecessor, mr. Chairman, sitting in that same chair we be he was putting together a comprehensive reform package which was completely paid for the best he could do is get to 25 without blowing a hole in the deficit. I think even that is generous in light of the value added tax, in light of the carbon fax that these corporations have to live in overseas that isnt part of the calculation that were making here as far as the competitiveness of our rates compared to other nations around the world. And with that i would like to ask unanimous consent to have included in the record at this time very interesting Associated Press article dated october 18, 2017, titled corporations to keep tax break loss by millions of americans. Without objection. Would you yield . I would be happy to yield but its judys time. Judy, would you yield . Yes. Thank you. Mr. Barthold, ms. Chu pointed out that my friend from california his district 24 of the people pay deduct take a deduction and if there were to go away they would lose 10,000. Also california is a donor state. We get 87 cents back for every dollar we send to washington. If this if this loss of a deduction goes through would california become more of a donor state than we already are . Mr. Thompson, im sorry, but the joint committee doesnt analyze changes in tax liabilities by state or Congressional District and as ive noted there are pluses and minuses within each of the income groups. So i couldnt say on net whether what happens to california, californias Income Distribution is different than the income than the national Income Distribution. Thank you i will take that as a yes. What i presented i wouldnt do that. What i presented was that on average across the Income Distribution there were net tax reductions in every income category. So i really cant say, im sorry. So, members, my intent is to recognize mr. Carbello and then if there are no others wish to speak on the amendment to have the vote moved to the next committee or next amendment excuse me. My hope and intention is to continue amendments through the vote series tonight, come back and do that vote series, recognizing that that will at this pace require us to go very long tomorrow. I think its important for us to do as much of this during the daytime hours as possible but we want to make sure we get these amendments in and continue the work. So i encourage lets make sure were getting these amendments out, having a thorough and open debate but disposing of them and moving in a good thoughtful timely way. Mr. Carbello. Thank you, mr. Chairman, just a couple quick questions for mr. Barthold. Mr. Barthold, this amendment thats under consideration now, do you consider it likely that it would cost jobs, it would cause job losses . Sorry. Mr. Carbello, we havent done any Macro Economic analysis on any of the proposals. The general thrust as was pointed out was to increase corporate or Corporate Tax burden relative to the chairmans the chairmans mark. The chairmans mark relatively decreases the Corporate Tax burden. I cant tell you where this proposal would end up. You could still be at a net decrease in the Corporate Tax burden and as a general matter net decrease in effect of marginal tax rates on corporate investments should generally be pro growth. So i dont have an answer for you. Could it have the effect of shifting jobs from higher tax states to lower tax states . The deductibility across across states it would it would increase without thinking completely thinking through all of the state tax state taxes it would generally accentuate differences in effective marginal tax rates on income allocated to different states. So it could lead to some planning of future investments that would change across states, yes. So it could benefit states like florida and act to the detriment of states like new york and new jersey, for example . New york if youre taking new york as an example of a higher business tax state and florida a lower tax state that would be the thrust of the analysis. Thank you, mr. Barthold. I yield back, mr. Chairman. Thank you. Mr. Carbello. Does anyone wish to speak on the amendment. . All those in favor signify by saying aye. Aye. All of those opposed no. No. In the opinion of the chair the nos have it. Pursuant to Committee Rule 19 for the proceedings on the amendment will be postponed. Are there additional amendments to the amendment in the nature of a substitute . Mr. Chairman, i have an amendment at the desk. Its being distributed right now. Thank you, mr. Kind. Mr. Reichert, do you reserve a point of order . Point of order has been reserved. The clerk will distribute the amendment. Does the gentleman from washington continue to reserve his point of order . I do not. I withdraw. The gentleman withdraws his reservatio reservation. The gentleman from wisconsin is recognized on his amendment. Thank you, mr. Chairman. Mr. Chairman, my amendment is very simple, this would restore what is being eliminated under the chairmans amendment which is the work opportunity tax credit and it would be skrauf set and paid for by commensurate increase in the Corporate Tax rate. Now, as you are well aware the work opportunity tax credit creates incentives within the tax code for additional hiring which has been especially beneficial for veterans across the nation. In fact, according to the recent estimates work opportunity tax credit is resulted in 150,000 additional veterans being hired by businesses large and small within the last year alone. On top of that because of the hiring the incentive that goes in and the hiring of individuals, it is estimated to save federal and state governments over 184 billion in entitlement spending over ten years because of reduction of recipients in tanif, in snap, in medicaid and in Public Housing vouchers. A tremendous cost savings given the incentive we are trying to restore with this and also fully paying for it. Listen, i think all of us are aware given the work we do in the Veterans Community and our respective districts and states how difficult that transition is for veterans who have been deployed, many in combat situations, trying to reintegrate in civilian life and one of the best things that research has found that helps veterans make that oftentimes difficult transition is a meaningful job that gives them some fulfillment, an opportunity to joe inn a team and to contribute back significantly within their community. The work opportunity tax credit has performed that role by creating incentives for businesses large and fall to reach out and make these veterans hired so that they are not lost in that transition. We think its a common sense amendment over certain incentives that need to be preserved in the code, especially given the impact that it has. We know that there are reasons why incentives exist in the tax code and that is to encourage certain behavior. Estimates now are coming out with the elimination of the work opportunity tax credit, could result in tens of thousands of veterans not being hired by businesses because of the lack of incentive within the tax code. So i would encourage my colleagues to take a look at this. It is offset so it doesnt add to the budget density by a small increase in the corporate rate which again as i mentioned in the previous amendment the previous republican chair thought that the corporate rate could be at 25 , not at 20 and still keep our Companies Competitive globally, still move jobs back forward overseas and still remaining the jobs that exist here right now. So with that i would encourage adoption of this amendment and yield back my time. Thank you. Mr. Smith, you are recognized to speak on the amendment. Thank you, mr. Chairman. And i certainly all of this debate here taking place right and exchange of ideas i think we need to discuss these items. I oppose this amendment. I think as you look at the big picture of employment certainly as i engage with employers across my district the most common concern among employers is finding employees. Recruitment and retention of employees is the number one issue and did you know that there are more than 6 million job openings, the highest level since the government started tracking it in the year 2000. At the same time the share of americans participating in the workforce is near a four decade low. I am not convinced that the work opportunity tax credit has been effective. The status quo clearly not working thats why the president has announced the expansion of apprenticeship programs which actually include wage subsidy programs. Thats the center of the president s Workforce Development agenda. I think we need to look for more effective ways and i think that our plan is more effective than the continuation of the status quo. How much more evidence do we need that the continuation of the status quo is not working . We need to do better. We can do better and thats why i think we need to debate this. And given the fact that and its not just my district, im quite certain where employers need more employees, the job openings are there. The work opportunity tax credit does not create job openings and i think and we will hear more from other members and their expertise on this issue that the work opportunity tax credit is just not doing the job and we need to do better and thats why broad based tax relief is the best way to ultimately increase wages. Its interesting there are some campaigns going on right now and the promises of higher minimum wages and politicians deciding what a minimum wage should be rather than creating an environment where every job applicant has more than one job offer. That will do far more for wages, increasing wages than a group of politicians coming together to decide, well, whats the best whats the best number . Without adversely impacting various other sectors of the economy and of the workforce. Lets work hard for this broad based approach of tax relief because that will do far more to grow wages and expand the economy. With that i yield back. Thank you, mr. Pascrell, youre recognized to speak on the amend ament. Thank you, mr. Chairman. I want to strike the last word in strong support of this amendment. My friend from new york, mr. Reed, im sorry he is not here right now, he and i have worked on preserving and expanding the work opportunity tax credit for many years the record will show. In addition to veterans, individuals living in empowerment zones and recipients of certain low income social services, i was proud that our bill to extent the wotc to a new class of qualified workers the longterm unemployed was accepted in december of 2015 to the path act by this committee. This provision allowed a tax credit of up to 2,400 for companies that hire a longterm unemployed individual. Studies show that job application for those out of the workforce for six months or longer get fewer call backs even over less experienced workers. This credit helps end the stigma of unemployment, brings americans seeking employment out of the shadows. This wotc expansion applies to new hires that begin work after january 1st, 2016 through december 31st, 2019, but this tax bill would eliminate that important credit all together. Just before veterans day we should not be taking away a credit that benefits the veterans. We should not be doing that. Many veterans face challenges in finding employment in a different field within they return from serving overseas particularly. In recent years we have made tremendous progress in lowering veterans unemployment rates. Thanks to a concerted effort of the Obama Administration veterans unemployment is at the lowest level in 17 years. Just 2. 7 . We should build on this progress. We cannot leave our veterans behind. Repealing the wotc would be a slap in the face to those veterans who have stood up and served the United States of america. And i yield the rest of my time to mr. Kind from the state of wisconsin. Thank you, mr. Friend, for yielding. Just to respond to my good friend from nebraska who said there is not only evidence that the work opportunity tax credit is working i beg to differ. I think the evidence shows exactly the opposite. A few years ago when we expanded the definition of eligible people for the work opportunity tax credit to also cover unemployed and Service Disabled veterans, there was an 81 uptick in hires of veterans after that definitional expansion. 81 . And a little ironic that today when many states are thinking about applying for waivers to start for the first time a work requirement in the medicaid program, the work opportunity tax credit also covers these eligible groups, those who are receiving snap, taniff benefits, ssi recipients, ex felons, vocational rehab programs and its encouraging employers to hire them. So this could be a way to try to encourage that rather than the states having to apply ask for waives to have a work requirement when these groups are facing obstacles out there. Thats why over the next ten years there would be 185 billion in entitlement savings by maintaining this expansive work opportunity tax credit. But the impact on the Veterans Community i dont think could be underestimated. Unfortunately there are job postings in all of our Congressional Districts but i think we have all encountered talking to these veterans, especially in the reserve units that have had to go through multiple deployments, facing difficulty being hired by businesses back home, its unfortunate but true because these businesses are afraid of the next deployment. And that employee being pulled from them for a 9 or 12 month boots on the ground deployment overseas and we are hearing more and more of those stories happening all the time. Its heart breaking that our veterans are being discriminated against for Employment Opportunities because of their service to our country, but it does happen with the deployments that have taken place in the past. The work opportunity tax credit is a way to incent businesses to hire our veterans an encouraging them to do the right thing and that is bring in a veteran with the skill set that they can offer to be a part of that team, have a meaningful job which can be fulfilling and a major contributor to the community. So again i encourage the committee to adopt this amendment. I thank the gentleman for yielding. Thank you. Mr. Rent acy youre recognized to speak on the amendment. The number one issue in my district and im sure in everybodys district including mr. Kinds district is finding qualified employees who are drug free. That is the key. How do we find qualified employees who are drug free . Companies are looking all the time and trying to hire these individuals. I was an employer for almost three decades. I can tell you how the work opportunity tax credit works. I can tell you how it worked for me. We were looking for employees all the time, we hired employees who were qualified, we brought them in, veterans, all of those, and in the end at the end of the year we hired a company to go back and look at everyone who qualified for the work opportunity tax credit because we were hiring people to fill jobs so the tax credit was actually a bonus at the end. It was a boenus by the way, the guy that i hired he got a percentage of the wotc credit which always frustrated me because there was paperwork and things that had to be done with it. So in the end i can tell you as an employer when im looking for employees would i rather have a work opportunity tax credit or would i rather have a 20 tax cut as a corporation . Or a 15 tax cut . Im going to tell you what i would rather have. Id rather have the tax cut which allows me to employ more people which allow me to employ more veterans which allows me to make sure im making the decision and im going to work as hard then to employ veterans and employ those disadvantaged because in the end employers are looking for these individuals. So, look, we continue to talk about gimmicks and ganders and all this other stuff but the facts are the facts and im sure that anybody else thats ever employed anybody, especially i have 3,000 employees at one point in time. When i was employing these individuals i was trying to just find them. Just fill these positions and every time i go through my district i hear the same thing, we cant find qualified people. We are hurting to fill these jobs. In the end nobody is hiring anybody, nobody is hiring anybody because of the work opportunity tax credit. In the end people are hiring individuals who are qualified and meet the qualifications and can help a company grow and im telling you as a businessman, which i was for three decades, and of all the companies i represent im telling you they would rather see a 35 rate down to 20 , a 15 cut so that they can make their own decisions than be worried about this credit. And with that would the gentleman yield . The gentleman yield . The gentleman has yielded his time. Mr. Larson, youre recognized to speak on the amendment. Thank you, mr. Chairman. And i would say to my good friend from ohio i think you were out of the room before when mr. Barthold was giving an explanation for another generalization that you made about whats in the bill and when it will happen, et cetera. We will go back to it again because i think mr. Neil made a very good point about that as did mr. Barthold and as did the joint tax about this. Its why i think some have made the observation that were talking past one another. My good friend from nebraska i said i would welcome him to come to hartford, connecticut. We have actually had people from who call themselves the 06120, its the poorest zip code in america and they all came together so that they could work as a community in a food desert and in an isolated area of social poverty who are advantaged by this. Now, im sure that that section of that district, that zip code does not look remotely like any zip code in nebraska. And i said that only because these individuals have taken it upon themselves, they came to washington, d. C. To see about the kind of opportunities that they could have and it just appears to me because i fully support the kind amendment, that it seems like the opposition to this amendment comes because that it was an obama proposal and, you know Michelle Obama and joe biden worked tirelessly on behalf of veterans and they remain a deep and abiding concern of all of ours to make sure that veterans have opportunities. They shouldnt be penalized because president obama happened to put forward this piece of legislation. My good friend in ohio keeps on talking about the facts, but apparently if our facts are put forth they dont count, so ron kind talks about how 81 81 up theic in the program in terms of how it assists people that apparently isnt a fact that any of you on the other side will regard. 81 , so this is a frustration on our side and with that ill yield to mr. Kind because he wanted to further elaborate on his amendment. I think i thank the gentleman for yielding. Hes right. The facts are the facts. The expansion of definition of veterans and disabled veterans under the old wotc there was an 18 uptic because companies were taking a closer look being able to hire veterans. Were seeing too many instances because of the repeated callups and deployment of these veterans, companies hesitating or holding back because of the hiring of veterans because theyre afraid of the next time that theyre going to be sent off for nine or 12 months boots on the ground. This is happening, unfortunately. And it shouldnt but if this tax credit is the way to get the companies to think anew, take a look at the value that our veterans can bring to the workforce, then why mess with it. If you ask the person back home do you think its right and decent within the tax code some incentive for companies to hire veterans, i think the average person would say, yeah, they would support that. The average person when told that working families are going to be denied a deduction of state and local tax but corporations are going to be able to keep it, theyll have a problem with that optics and disparity. Im trying to help you here, as far as the politics back home. I encourage you to keep a very popular veterans tax credit for hiring veterans which i think wed all like to see more of in our community so theyre not on snap, so theyre not in tan ef on some other program that costs tax dollars some other way. Id be happy to yield to my friend from massachusetts. I certainly am in support of mr. Kinds amendment. I want a letter into the record who are opposing hr 1. Without objection. Gentleman yield back. Its my time but i would only further add that you should sit down and talk with hal rodgers also because we should be talking about expanding opportunities in these areas, especially when facing an Opioid Epidemic that we need to step up with. And i would dare say that even rural districts will have this epidemic upon them as much as people in the 06120 who are dealing with this problem as well and with that ill yield back. The gentleman yields back. I thank my colleague for raising this issue. I recognize the need to encourage the hiring of those who struggle to get into the workforce. For example, people who may have served time in prison and some of the others who have been mentioned in this discussion. Unfortunately, the work opportunity tax credit isnt the best way to do it. In speaking with employers and payroll providers, it does not drive behavior and doesnt encourage employers to hire because often times only verified at tax time and isnt considered when the individual is actually hired. The concept behind the work opportunity tax credit is to provide a hiring incentive but the wage subsidies it provides are modest at best. Instead, this committee worked in a bipartisan manner and i was proud to team up with dr. Davis to pass in the house hr 2824, the accelerating individuals into the workforce act. Passed the house by an overwhelming 377 to 34 vote. Hr 2824 does what the work opportunity tax credit cannot. It supports employer led partnerships with state and local agencies to hire recipients from the temporary assistance for needy families tanef programs which includes those having returned from prisons. Sets aside 15 of funds for programs that offer workforce innovation and opportunity act to find Career Pathway services which was a democratic amendment to the bill. It also provides a substantial wage subsidy equal to no more than 50 of the wage while the other half of the wage would be paid for by the employer or with state or local funds. I think these are the types of programs of ideas that we need to promote to truly help these individuals get into the workforce. A program that employers will be aware of and will actively take advantage of, not learn about after they have already hired individuals who may or may not qualify for the work opportunity tax credit. So i do thank the gentleman because i think all of us in this committee, all of us want to help these individuals who struggle the most to get back on their feet, to get to work. We want to help them, but i think we should find for the programs, for the ideas that make it most likely, most efficient to help these individuals and quite frankly, that help them the most. So i would propose that instead of this amendment that were considering today, lets make a commitment to Work Together, number one, to make sure this legislation becomes law, because it was passed out of the house and also to look for other opportunities such as this one where we can help the individuals who need it most. Thank you very much, mr. Chairman. I yield back. Thank you, the gentleman yields back. Dr. Davis youre recognized to speak on the amendment. Thank you very much, mr. Chairman. Im somewhat amazed at the disconnect between the experiences and effectiveness as different people have evaluated the work opportunity tax credit. As a matter of fact, the governor former governor of illinois was a major fan and continues to tout his use of that tax credit as one of the most effective things that he did while he was governor. As a matter of fact, in 2015 in illinois there were over 100,000 work opportunity tax credit certifications. These over 100,000 people who were employed, many in good jobs who had the income to buy goods and pay taxes. Many of these individuals had been on food stamps, were returning citizens as mr. Cubelo just mentioned and were individuals who were hard to hire and couldnt get hired. So im kind of shocked that there would be an effort to repeal or take away these opportunities. As a matter of fact, i was pleased to join with representative wiek conservative to introduce the Employment Outcomes for the youth act that would make it possible for transition age foster youth to qualify and be able to get jobs and to work. So i guess evaluation just kind of is like beauty. Its in the eye of the beholder. And what some see, others do not see. But i can tell you as an individual who has worked for many with low income hard to hire, unskilled individuals, that this was a program that has worked, continues to work and i think we do ourselves a disservice as we transition into something else. But i will also indicate that i certainly appreciate the words of mr. Curbelo relative to what his interaction has been with the type of individuals who have made the most effective use of this program. So i would yield the rest of my time to representative pascrell. Thank you, mr. Davis. I frankly have heard this term qualify for the job and we certainly want people to be qualified for the job. Now, are you telling me, my friend from ohio, that youd rather have a tax cut go to the proprietor, to the employer than make and him make that decision whether hes going to add on individual personnel . What happened to 2001 and 2003 was not what i just described. Corporations, individuals, et cetera got tax cuts, they did not move into brick and mortar and it did not hire other employees. These are six or seven great programs that have been working in our streets. And i know when youre millions of miles from densely populated areas, you have to come back and see what the heck these programs are doing rather than just read about them. These are valuable programs and youre taking them away and saying well probably accomplish much more if we just give the proprietors a tax cut. Well, they had situations before these programs and they werent hiring these very people were talking about. Veterans, exfelons, vocational rehab, referrals. These are people these are members of our own families, perhaps. Our own neighborhood. I dont accept that because youre going to get another tax cut that then were going to be able to hire people that need a job. I think the wotc programs have worked and i ask that you reconsider what youre about to do. Yield back. Thank you, mr. Reed. Youre recognized to speak on the amendment. Thank you, mr. Chairman. Mr. Chairman, im going to take a little contrary approach to the work opportunity tax credit issue. As mr. Pascrell had indicated, he and i have a lengthy relationship of working on this policy. I support this policy. Mr. Pascrell knows that, mr. Kind knows that and i believe this policy works. It actually comes from one of my predecessors, my mentor on this kmeel and a personal friend of our family for decades who said on this committee who sat on this committee for 18 years and it was his idea to create this type of tax policy. But ive got to be honest, what i think youll see here today and this is the beginning of it, is that these difficult issues, these difficult positions that we have supported are going to be put in front of us and the other side is going to say that were taking away policies that help vets, were taking away policies that help workers. But the question i have back to you is, if we adopt this amendment, will you support the bill on the floor of the house to make sure this priority you say is so important to you, so important to you that its in here and that you want us to vote against our own policy that we actually support, i know whats going on here, ladies and gentlemen. Theyre going to want to put me on the record to vote against something that i have supported. Its the politics of washington, d. C. Will the gentleman yield for a question . Not yet. Not yet. Because this is the game in d. C. That has brought us to gridlock that has brought us to the situation we find in washington where people if you want to have a good faith negotiation and you want to find 80 of Common Ground and come together for solutions, im willing to do that, but to put this out there and i would ask you and ill yield for you for a simple question, if this gets adopted and this gets in the bill, you guarantee me, look me in the eye, that you will vote for tax reform when it gets to the floor of the house with this legislation in it . I think its a fair question and ill give you a fair answer. Yes or no. This amendment is fully paid for. You still have a 2. 3 trillion. Yes or no. Reclaiming my time. Its not my time. Reclaiming my time. As youve seen from the response that was not a yes or no answer. Will the gentleman yield . That is politics. No. That is politics on the display here. I gave the gentleman i gave the gentleman its my time. I gave the gentleman ample time to say yes or no he would support this. If this is the priority to protect vets, he would support this on the floor of the house and what did you get, you got a d. C. Response, ladies and gentlemen. You got a d. C. Response that says blah, blah, blah. Yes or no. If the answer would have been yes, simply, we could maybe have a different conversation on this but i think, mr. Pascrell would you support not in this bill, no. Reclaiming my time. Reclaiming my time. Mr. Pascrell, mr. Pascrell. This is exactly, so no. So hes going to make us vote on very sensitive political issues. Youre going to see numerous bills of these today, ladies and gentlemen, and this is the frustration i have with washington, d. C. And this is where if we can get 80 you shouldve asked us before you put the bill together. Its my time, mr. Pascrell. If the gentleman will suspend this is a difficult, very difficult issue that i have to face, but im willing to move the ball forward because i know whats going on here. I am not going to live with this any longer. I am not going to let the 70,000 pages of code sit here and saddle my people back home day in and day out with a code thats broken for the American People. I am not going to watch our American Industries go overseas because of our broken tax code any more. And im not going to engage in this political theater any longer. So with that, mr. Chairman, i cant support this amendment even though i do support the work opportunity tax credit. I do recognize the positive return it has on a lot of folks but at the end of the day. Im going to move the ball forward on tax reform and i will come back and i will continue the fight to make sure work opportunity tax credit continues after tax reform is done and we deliver immediate relief to the people i represent back home and with that i yield back. The gentleman yields back. Mr. Pascrell . Thank you. And before you speak, if i may and ill give you back your time. Yes, sir. Out of courtesy and respect, lets let the members finish their statement and ask them to yield. We can have this respectful conversation. Mr. Pascrell. Thank you, mr. Chairman oh, kouf another member yield, ms. Sewell is next. Perhaps she can begin. Mr. Speaker, before i yield to the gentleman from new jersey, i just wanted to answer the colleagues question with respect to whether or not we could vote for the bill. I think that the time to have asked that question was when we decided to put together a tax reform bill. The whole point is that theres its a lot of complications in the tax code. Your stack of books over there shows that and so, only one party decided to figure out what the winners and losers would be, what sections you would choose. And thats not fair. Its not fair to the people i represent and its not fair to your people as well. The reality is we should have done this in a bipartisan manner in which we all talked about the various sections of the code and were able to have hearings to hear from experts about that. Im going to yield the rest of my time to the gentleman from new jersey. Thank you. My friend, mr. Reed, from new york, great state of new york, great congressman, these are tough votes youre going to have to take and we have many, many more amendments and youre going to have to make a decision as im going to have to make a decision as to whether or not this really does approve the ability of folks to either get jobs, improve their jobs or creating jobs here in america. Youre going to have to make that decision. Youve already said that this these are programs that are darn good. Weve already established that. But to ask me whether or not ill vote for the bill if i vote for this, would you vote for the bill . Weve got a lot of other amendments. It doesnt come close to the trillion, 100 billion theres a lot of things that have to be changed here for me to even think about it and what the gentle lady just said, it would have been a lot easier if we did this together before hand as was done in 1985 when they worked two years prior two years prior to the legislation coming to the floor and senator bradley coming together with president reagan, coming together, tip oneill coming together. They had to work to do this. They didnt do it this way. You know they didnt do it this way. So isnt it the real d. C. Game, the d. C. Political game, making a provision about struggling workers all about you . Not all about you. Its not all about me and mr. Reed, you know that. You know its pay good program. The program didnt get worse because of this amendment, this bill rather. The program didnt get any worse. It didnt become i have the statistics here of whats happened over the past several years with this program. Each of them. Each of them. And ill be darned if youll get me to admit that a tax cut is going to solve any problems that exist in any of these programs. The same old story. In fact, you go back to the debate of 2001 and 2003, when i was here, its the same presentation, changed a few numbers, changed a few dates and changed a few names. Its the same thing. Give the people back their money. Theyll know what to do with it better than us. In other words, undercut the government, make the government more disrespectful from the people, this does not help the situation that we are in. I defy you to show me how you are going to show me statistics that cutting the taxes is going to help put people to work. You cant show me the statistics. You dont know it. I want to cut taxes. Theres not one person up here thats not going to vote for a cut that that wouldnt vote for a cut in the Corporate Taxes. Charlie and i started that back in 2007, 2008. We had no problems with that. But in order to pay for that, in order to do for those things, youve asked too much. You shouldve asked us before. Now you got the problem. You got guys retiring. Theyre leaving. What, do you think theyre leaving because of the weather. Gentleman yield . Theyre leaving and theyre leaving for a reason. I know im not that old. Theyre leaving for a reason. Theyre leaving for a reason. Come on, mr. Reed, youve been with me on this for so many years. Gentleman yield . Im not turning my back on them. Will the gentleman yield . Yes, sir. You know i love you will and i work with you prove it. [ laughter ] but this is the time of having that conversation, if youre sincere of coming to a yes, dont do the one off political theater, lets see what you got. With that i yield. Its not unconditional love, mr. Pascrell. So heres my intention to recognize mr. Doggett if theres no other members that wish to speak on the matter. I yield to mr. Kind. I thank my friend, just to wrap this up, mr. Chairman. I believe in the sincerity of my good friend from new york, mr. Reed and i believe it has proven its worth. He was nothing but class, a former marine veteran himself who was the father of this program, but dont discount my sincerity or the other peoples sincerity when we are worried about the elimination of this tax incentive that is meant to hire veterans and disabled veterans and get them back into the workforce. This isnt a political game will the gentleman yield here . You called it a political game here. Will the gentleman yield . Ive seen it first hand and i pledge to you after tax reform, after we get through this process, ill continue to work with you in regards to this. I appreciate that. But what is becoming all too frequent around here, mr. Chairman, is the political game thats being played behind closed doors on complicated issues like comprehensive tax reform which will have a consequential hearing on every human being. No real solicitation of any bipartisan bill to put a bill together which is hard and complicated and suddenly having a major change to the code in over 31 years dropped in our lap for the very first time to see whats in it and not in it and then expecting us to make snap judgments. Thats the political game thats being played in washington and the lawn of lobbyists are lining up at your doorstep to protect their interest in this legislation and its reflected in so many provisions. Thats what troubles me about this whole process. There is a better path forward, more bipartisan, doing our home ork, running towards the criticism as i said before, to get the feedback on the intended and unintended consequences of whats being proposed with this comprehensive reform package. Thats the world i wish we were living in here but unfortunately it isnt today. Because of the politics have become so perverted and so onesided and somehow weve got to figure out a way to get back to that place where we can Work Together with some common interests. I think there is commonality in taking a serious run at the cold and over 31 years to oversimplify and make it more competitive and fair and i yield back to my friend from texas. I thank the gentleman for his comments. Im a little confused by the comments of the gentleman from new york and some of his colleagues because the last chapter in this occurred about 5 45 last night when we were presented a 33 page amendment from the chairman that had never been shared with us before, where we were declined the opportunity to even give get a few minutes to review the amendment and we mainly heard from our republican colleagues theyre praise of the chairman for all the great things he put in the amendment. Well, you didnt have to negotiate with the democrats, you couldve negotiated with your colleagues and put in the work opportunity tax credit in that 33 page amendment. I can tell you wall street banks did rather well in that amendment. They got themselves another little bonus to avoid taxation on their International Transactions but the veterans got left out entirely. So did those families that are involved in adoptions, the adoption tax credit. It was totally omitted from those 33 pages. So did students who have interest on their loans and are buried in debt, are there parents . They can no longer deduct Student Interest on those loans, so did those individuals who are given the opportunity by their employer to go to a community college, maybe for a welding, maybe for Health Degree in order to advance within their job, they are they are taxed on that under this bill. Its one provision after another that if there had been any good faith negotiation, even among republicans, we wouldnt be facing the sorry bill that we are facing today and we would not need mr. Kinds amendment, but that was not done. Instead an entirely partisan effort and it is so amazing to have our republican colleagues come forward and have a consume buy iowa moment and couldnt be all just Work Together and solve these problems. Of course we could. You dont start after the markup begins. You start by having the kind of hearings that we have sought all yearlong. You begin by having the Trump Administration show up and actually answer questions instead of thinking that they can govern solely by tweet. I yield back. The gentlemans time is expired. I know the chairman wanted to move on. Mr. Meehan youre recognized. Thank you, mr. Chairman. The fact is i know that there are colleagues on the other side of the aisle who generally do not only want to but do frequently Work Together on bills. Look, lets stop the political theater here. Here it is. Right here in the headlines. Its as clear as it is. Dems plan to tank trumps tax bill. Its that straightforward. This wasnt just yesterday when this bill was put in here. This is the language. Democrats help crushed Obamacare Repeal by maintaining totally unity and generating broad public outrage. You see this. This has been the thee at tricks of the entire thing. Just generate outrage. This is the plan. This is the playbook. Its published. The stakes couldnt be higher for nancy pelosi and chuck schumer, not only do most democrats loath the republican tax plan, we know that, but leadership believes torpedoing it would boost the partys chances of taking back the house and Holding Steady the senate in 2018. This isnt about this bill. This thee at tricks is all about the politics of trying to see if they can take over the house. Fine. But lets not lets call it what it is. This is in their words. Nancy pelosi is driven to deny republicans any votes. Shes particularly driven to deny republicans any votes from her side of the aisle if the gop marches for a victory on taxes will depend on some of her moderates. Lets call it what it is. This is the politics that mr. Reed was discussing. Mr. Chairman, i yield back. Your question all those in favor signify by saying aye. Aye. Those opposed no. No. The nos have it. Pursuant to the committee, further proceedings on the amendment will be postponed. Are there additional amendments to the amendment in the nature of a substitute . Mr. Chairman . Ms. Sanchez youre recognized. I have an amendment at the desk. I reserve a point of order. The clerk will distribute the amendment and i ask the gentle lady to suspend while the clerk distributes. Mr. Paulson . Gentleman i withdraw my reservation. The gentle lady is recognized for five minutes on her amendment. Thank you, mr. Chairman. My amendment would fix this bills woefully inadequate Child Tax Credit provision and my amendment is based on the excellent work that congressman rosa has tirelessly pursued for years. When ways and means democrats were summoned to the white house to meet with the president , he told me that i would love this Child Tax Credit so much that i would call him personally and thank him. Well, guess what . I never made that call because i dont love this plan, i hate it. The bill before us today is full of hollow changes design today sound like theyre helping the middle class but in reality are give aways to their wealthier neighbors. It leaves the most vulnerable in our country to fend for themselves. Currently the Child Tax Credit provides families with 1,000 per child under the age of 17 and only refundable up to 15 of income above a working parents first 3,000. In other words, a single parent working full time yearround minimum wage job while taking care of three kids will never ree