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Estate-Tax Repeal Proposals Eyed By Some in House GOP

July 17, 2013

The top Republican tax writer in Congress is being pulled toward a more extensive rewrite of the U.S. code, with more than half of his party’s members in the House backing proposals to rip up the rules.

More than 125 House Republicans have supported proposals that include ending the income tax and terminating the entire code in 2018 to force Congress to create a simpler system. Sixty-eight of them favor what they call a "fair tax" replacing the income, payroll and estate levies with a national sales tax. Dozens back estate-tax repeal proposals. A flat-tax bill has 10 Republicans on board.

Rank-and-file Republicans’ support for bold changes may move Representative Dave Camp of Michigan, the party’s top tax writer, in their direction even as he tries in coming months to draft a plan that could attract some Democratic support. Camp must try to satisfy Republicans eager for a major shakeup while leaving a path to a bipartisan agreement with the Democratic- controlled Senate and President Barack Obama.

"We’ll have our share of boldness," Camp, 60, said in an interview last week. "Tax reform will be bold. There’s no other way to do it, so we’ll just see how bold everybody wants to be."

Camp, chairman of the Ways and Means Committee, has been meeting with all 34 first-term House Republicans to hear their ideas on taxes. There are no first-term members on the Ways and Means panel, and 44 percent of the party’s members have been in the House for fewer than four years.

Flat Tax

"I love the flat tax, and I’m not afraid of getting rid of every deduction," said Representative Thomas Massie, a Kentucky Republican who became a House member in November 2012 after winning a special election to fill a vacant seat.

Camp’s attempt to balance his party’s preferences with his desire to make lasting law is challenged by the dynamics of the House, which has 234 Republicans and 201 Democrats. The party’s proposals on the budget, agriculture programs and prioritizing U.S. debt payments were written to appeal to the Republican base, which has resisted bipartisan approaches. All three measures were passed without a single Democratic vote.

House Republicans haven’t yet grappled as a group with the details of tax policy, making it hard to tell whether or how the party will coalesce on one of its top priorities.

Furthermore, a decision by lawmakers to co-sponsor a bill to enact a sales tax or terminate the tax code would still allow them to support something Camp proposes. Instead, those expressions of support send signals about their priorities to their home-district supporters and to Republican leaders.

Two Levels

Proposals like the national sales tax and flat tax probably aren’t in the cards. Camp has said he wants a two-level income tax for individuals and said he would keep the system about as progressive as it is now.

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