(Bloomberg News) Republicans in the U.S. House are showing signs of backing away from a small-business tax break included in their campaign platform last year.
The proposal, which would provide a 20 percent deduction for companies with 500 or fewer employees, wasn't included in a jobs plan released today by House Speaker John Boehner, an Ohio Republican.
Representative Dave Camp, chairman of the House Ways and Means Committee, said he wanted to consider the idea as part of a broader overhaul of the tax code. Without specifically ruling out a special deduction for small businesses, he said he wanted to rewrite the tax code to lower rates and eliminate special tax breaks.
"We will incorporate tax relief for small business in our fundamental tax reform package that will be comprehensive," Camp, a Michigan Republican, said today in Washington when asked about the omission of the small-business proposal. "What we're looking at is having as low a rate as possible with as few exceptions, deductions, provisions, tax expenditures, preferences that we can have in the bill for simplicity, for certainty."
The proposal in the 2010 campaign pledge was based on a bill that Camp wrote that would provide a 20 percent deduction for two years.
Capital Infusion
"This will provide entrepreneurs with a much-needed infusion of capital for investment and new hiring," the pledge said.
As written last year, the $25 billion tax break would not have applied to income from banking, insurance, professional sports teams, golf courses and country clubs, massage parlors, hot-tub and suntan facilities, gambling and animal-racing properties and the adult-film industry.
The deduction's omission from the Boehner jobs plan doesn't mean that it has been abandoned, said Brad Dayspring, a spokesman for House Majority Leader Eric Cantor, a Virginia Republican. Dayspring, in an e-mail, deferred to Camp on details of how it would be incorporated into a tax-code overhaul.
Echoing previous statements by Camp, the jobs plan calls for top rates of 25 percent on corporations and individuals, down from the current 35 percent.