October 24, 2013, the Democrats of the House Ways and Means Committee sent a letter to Chairman Dave Camp calling for a bipartisan effort to move forward on tax reform. They point out the need and the challenge, noting it will likely require $5 trillion of revenue to repeal the AMT and lower the corporate and individual tax rates to 25%.

I think this is a positive move! I also think that Chairman Camp and Senate Finance Chairman Baucus are committed to moving on comprehensive tax reform. I think we will see proposals from one or both committees in the next few months. As to how specific they will be with respect to how the tax base is broadened in order to lower rates in a revenue neutral manner is the big question.

The letter’s key excerpt:

“Comprehensive tax reform must be the product of a bipartisan process. The Tax Reform Working Groups set the Committee off to a good start, and began the process of Republican and Democratic Members on the Committee digging into the substance of current law. The next step is to discuss tax reform legislation together.

“We acknowledge that our approaches to tax reform have significant differences. We believe that everyone should pay their fair share of taxes. For example, the Joint Committee on Taxation estimates that lowering the top individual and corporate tax rates to 25 percent and eliminating the alternative minimum tax, as proposed in the House-passed budget, would cost more than $5 trillion. In setting any rate, it is vital to determine what effective policies should be reflected in our tax code

“The last three weeks have made it clear that the only path for passage of comprehensive legislation in the House is one that garners a governing majority through Republican and Democratic votes. In order to make the difficult task of tax reform a reality, it is essential to sit down and earnestly discuss tax policies that will strengthen American families and enhance U.S. competitiveness.”

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