Keep An Eye On These Tax Proposals, Despite Congressional Gridlock

Tax legislation might be hard to pass this year in a closely divided Congress, but that doesn’t mean that tax proposals will be in scarce supply. Recent hearings in the Senate Budget Committee and the House Ways and Means Committee offered the usual congressional grandstanding on taxes, but also served up a smorgasbord of possibilities. Even if those proposals are mostly fantasy in the short term, they’re worth paying attention to because tax ideas never really die — they just hang around until a motivated legislator finds a way to advance one of them.

There was limited movement on tax legislation in the House in April. The Limit, Save, Grow Act (H.R. 2811) passed in that chamber, but has no likelihood of passing the Senate and President Biden announced that he wouldn’t sign it even if it did. The debt ceiling legislation would have repealed some of the energy tax provisions in the Inflation Reduction Act (IRA, P.L. 117-169) and rolled back others, but they aren’t in grave danger. The bill would also have rescinded about $71 billion of the $80 billion the IRA granted to the IRS, according to the Congressional Budget Office estimate.