The GOP's legislative agenda for September, outlining its plans to pass a series
of further bills, including tax proposals, prior to the November elections, has been
outlined in a memorandum sent to all United States House of Representatives
Republicans by Majority Leader Kevin McCarthy (R – California).
As a means of emphasizing the GOP's priority prior to the elections, McCarthy
has included a "jobs" package of measures, assembled from 14 bills
that House Republicans have already passed during the current Congress, and none of
which, of course, can be expected to be taken up in the Democrat-led Senate.
Within those bills are the legislation to renew permanently "tax extenders,"
such as bonus depreciation, which allowed all levels of businesses to deduct
50 percent of the cost of new capital purchases within the first year, and the
research and development credit.
In addition, the package would include renewal of Section 179 expensing that
permitted smaller businesses to immediately deduct the cost of investments in
property and qualifying equipment. Following its expiry, its threshold has fallen
from USD500,000, on up to USD2m of equipment, to USD25,000 on USD200,000 worth.
Another bill, the S Corporation Permanent Tax Relief Act, would make permanent
the shortening of the built-in gains tax-holding period for S corps from ten
years to five years to give shareholders quicker access to capital at a reduced
tax cost, while McCarthy's package also includes the Permanent Internet Tax
Freedom Act (PITFA), which would make permanent a moratorium on the taxing of
internet access by US states.
PITFA passed the House earlier this year, but has since stalled in the Senate.
There have been moves in the latter to link it with the more controversial Marketplace
Fairness Act (MFA), which would allow states to impose sales taxes on online
purchases, and which has been stuck in the House Judiciary Committee. GOP aversion
to the MFA has mainly arisen due to its being seen as an increase in taxation,
and in tax compliance burdens on smaller businesses.
Finally, and without comment, McCarthy noted that "the House will also
pass a Continuing Resolution that will continue government operations as they
are on September 30 into the new fiscal year." If such a short-term, temporary
bill could be approved by Congress, the threat of a government shutdown over
the November election period will be avoided.