The chances of congressional leaders advancing a comprehensive tax reform bill this year appear to be fading, as House Ways and Means Committee Chairman David Camp (R-Mich.) acknowledged to reporters this month that he may miss his self-imposed deadline of moving a bill through committee before the end of 2013.
According to reports from Capitol Hill, Chairman Camp blamed October’s 16-day government shutdown for claiming valuable time that could have gone toward developing a tax-reform bill. Additionally, the recent focus of Congress on the difficulties associated with the rollout of the Affordable Care Act has left little room on the agenda for consideration of a major tax overhaul. The House of Representatives is tentatively scheduled to adjourn for the year on December 13 – leaving only a few legislative workweeks left.
On the other side of the Capitol, Senate Finance Committee Chairman Max Baucus (D-Mont.) could still release a discussion draft of his own tax reform proposal this year, but it at this point would have little chance of moving through committee before year’s end.
The likely delay in tax reform action also means the fate of tax-exempt municipal bond interest will remain uncertain for the foreseeable future. Though preserving the current exemption has many supporters (AMWA among them), Chairmen Camp and Baucus previously promised to put all tax breaks and deductions on the table for consideration during tax overhaul discussions. That pledge, combined with President Obama’s FY14 budget proposal that would scale back the value of the exemption, means that AMWA and municipal bond supporters must remain prepared to defend the exemption into 2014.