Businesses ready ... aim ... hold their fire

[babylonsister]

Businesses ready ... aim ... hold their fire
By Jessica Holzer
October 30, 2007


Some prominent members of the business lobby came out swinging against the giant tax overhaul Rep. Charles Rangel (D-N.Y.) introduced last week, but the legislation may ultimately attract its share of K Street backers.

“The business community is going to be somewhat divided about the Rangel bill. There will be some that will be attracted to the bill because of the rate cuts,” predicted Robert Leonard, a lobbyist for Akin Gump Strauss Hauer & Feld who served as tax counsel to the Ways and Means Committee during the 1986 tax reform.

The last time Congress tackled fundamental tax reform, a strong business coalition threw its force behind the legislation, eventually clinching its enactment in 1986. Back then, Rangel was a senior member of the Ways and Means Committee, which he now heads.

The New York Democrat has mimicked parts of the 1986 reform, which broadened the base of taxpayers, while cutting the corporate tax rate and rates on individuals.

Rangel’s proposal would cut corporate tax rates from 35 percent to 30.5 percent and grant tax relief for lower-income individuals. To pay for those cuts, Rangel would raise taxes on many higher income earners and eliminate some tax breaks that are popular among businesses.

Many business groups swiftly denounced the bill. But others have held their fire, perhaps signaling support for portions of Rangel’s self-described “mother of all” tax reforms.

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