GOP tax-writers in the House say the “fiscal cliff” agreement has made them more confident that a tax overhaul can be passed in 2013 that lowers rates without bringing in more money to the government.
The law that President Obama signed this week allows the top tax rate to rise back to 39.6 percent, locks in rates long-term and resolves longstanding problems like the Alternative Minimum Tax.
Those changes give policymakers on both sides of the aisle a firmer starting place for tax reform discussions. Officials had been facing several different revenue pictures, or baselines, that varied wildly depending on the fate of the George W. Bush era tax rates, which expired at the end of 2012.
The fiscal cliff deal gives lawmakers a single revenue baseline to work from, making it far more likely that an ambitious rewrite of the tax code can begin.
“I think it’s important that we got the permanent tax policy, because that lets us pivot to comprehensive tax reform, which is so important for growth and jobs,” Rep. Dave Camp (R-Mich.), the chairman of the House Ways and Means Committee, told Bloomberg Television’s “Political Capital.”