While the White House and Democrats quarrel with Republicans over sequestration and debt ceiling limits, a quieter and, we hope, less confrontational effort is under way to accomplish something that the political climate would seem to be hostile toward just now — a revision of the U.S. tax code.
There aren’t many people who would defend the nation’s tax code as it stands, though some might have pause at the idea of revamping it, figuring that the devil you know is better than a worse devil that you might end up with.
But there is some indication that this effort may have an outside shot at getting started. For one thing, both bodies of Congress — the House and the Senate — have begun working on a tax code revision. In the Senate, the top budget writers for both parties — Senate Finance Committee Chairman Max Baucus, a Democrat, and Sen. Orrin Hatch, a Republican, are working together.
The potential deal-breaker in this are tax loopholes, which Republicans and Democrats both rail against. While you would think that unison over the need to close tax loopholes would be a unifying agent, it’s not. Each party has its own idea of what actually constitutes one.
One person’s unfair loophole, it seems, is another person’s legitimate deduction, and one person’s legitimate deduction is another person’s unfair loophole.
And everyone who will touch this legislation, should it ever get written, will have constituents and — likely more importantly — donors who will have specific tax breaks that they will conjole lawmakers to keep intact.
For instance, should tax incentives for oil companies be discontinued? What about the mortgage interest deduction on personal income tax? Charitable contributions?
The issue gets murkier when it gets closer to home.
The best hope here is that lawmakers in both houses keep tax reform separate from the fiscal squabbles where unmovable positions have been staked out and cooperation across the aisle is unlikely. Perhaps it can fly under the radar until party leaders reach a point where they feel like governing instead of fighting.
It’d be a nice change.