A group of conservatives, led by a group formed by former Vice President Mike Pence, wrote to the top Republican on the powerful Ways and Means Committee on Monday urging him to slash the corporate tax rate and eliminate capital gains taxes on inflation.
Nearly 40 conservatives, most of whom lead think tanks and policy groups, wrote two separate letters to Rep. Jason Smith (R-Mo.), who will play a central role in crafting tax policy in the next Congress, where Republicans plan to extend tax cuts first signed into law by President-elect Trump in 2017. The leters were obtained first by The Hill.
“We thank you for your early and important work to extend the expiring portions of the Tax Cuts and Jobs Act of 2017 (TCJA). As part of this effort, we encourage you to stand with President Trump and reduce the corporate tax rate to fifteen percent or lower,” the group wrote in one of the letters.
The 2017 tax law reduced the corporate tax rate from 35 percent to 21 percent, but Trump and some other Republicans have argued that reducing it further would incentivize companies to do business in the United States.
The second letter urges Smith to eliminate the capital gains tax on inflation as part of legislation in 2025.
“It is simply unfair for a taxpayer to have to pay capital gains tax on inflation, since the taxpayer receives no actual increase in value or purchasing power due to inflation. Quite the opposite. The taxpayer is already struggling to pay for everyday expenses, and then also has to pay capital gains tax on phantom gains. It is long past time for this injustice to be corrected,” the letter states.
The top signatory on both letters is Paul Teller, the executive vice president of Advancing American Freedom, which is an advocacy group formed by Pence after he left office in 2021. Preserving the tax cuts from the 2017 law has been a major priority for Pence’s group.
Others who signed on include Grover Norquist, the president of Americans for Tax Reform; Brent Gardner, chief government officer of Americans for Prosperity; Alfredo Ortiz, CEO of the Job Creators Network; Saul Anuzis, president of the American Association of Senior Citizens; and Annette Olson, CEO of the John K. MacIver Institute for Public Policy.
Republicans have been debating how to sequence their legislative agenda beginning in January, when they will control both chambers of Congress and the White House.
Some top Trump officials have indicated they would like lawmakers to pass a bill in January through the reconciliation process, which would not require any Democrat support, to bolster border security, while planning a second reconciliation bill on tax reform later in the year.
But others, including Smith, have raised concerns about pushing tax reform to the backburner.
Smith has noted the difficulty of moving two budget reconciliation packages, especially given House Republicans will have a tiny majority.
