“Can you get people to put their party loyalty above home-grown constituents’ concerns?” said Hollier, a former chief of staff and legislative director for Senator Mike Crapo, an Idaho Republican. “How they deal with that will show that people can be broken.”
A spokeswoman for the Ways and Means Committee declined to comment.
Some conservatives wonder if the secrecy does more harm than good. “I think it’s important that members feel like they have ownership of big, majority-defining packages like this,” said Ryan Ellis, a tax lobbyist who formerly worked with anti-tax activist Grover Norquist. “They really didn’t on health care.”
The tax framework that the White House and GOP leaders released on Sept. 27 calls for tax rate cuts for individuals and corporations, and is estimated to raise the deficit by $2.4 trillion. Republicans need to get that number down to $1.5 trillion under their budget parameters -- a difficult balancing act as they’ve promised a more generous Child Tax Credit and bigger tax breaks for middle-income families.
“I don’t think that people realize that 80 percent plus of this effort is eliminating things in the code,” said Senator Bob Corker of Tennessee, who has called for a tax bill that won’t add to the federal deficit after taking into account reasonable economic growth expectations.
“I mean, over the next two weeks, especially when the Senate tax-writing committee puts their stuff out, they’re going to realize that this the biggest tax code rewrite since 1986 and it’s going to affect everyone,” he said.
‘Totally Undecided’
One of the ways to make up the revenue gap is by limiting the deductions corporations take on the interest they pay on their loans -- a major consideration for industries such as private equity and real estate. A prior House Republican proposal called for completely eliminating the corporate break, which could have raised more than $1 trillion over a decade.
“They’re totally undecided,” about how to restrict corporate interest deductions, said Marc Gerson, the chair of law firm Miller & Chevalier. Gerson said proposals include setting limits based on a company’s earnings before interest, tax, depreciation and amortization, or Ebitda, a key measure of profitability. Existing debt might be grandfathered in, he said.
Another piece of the framework is aimed at preventing U.S. companies from shifting their earnings to offshore tax havens -- by imposing a minimum foreign tax. The idea -- described briefly and obliquely in the framework language -- was called “appalling” several weeks ago by Ken Kies, a lobbyist whose clients include Microsoft and General Electric Co. The rate and formula for such a tax haven’t been specified, but the proposal carries multibillion-dollar implications for multinationals.