I spoke to Laura Davison from Bloomberg BNA about the relative merits of the Senate’s approach to pass-through taxation:

“It is certainly a much cleaner approach than the House. If the goal is simplification, that’s a simple way to do it,” said Liam Donovan, a principal at Bracewell LLP.

The 17.4 percent deduction number is “oddly specific,” indicating that the Senate tax writers needed to contain the cost of this provision, he said. The Joint Committee on Taxation estimates the deduction would add about $459.7 billion.
…
The Senate plan avoids one of the more complicated aspects of the House approach: determining what income should be taxed as wages, and what should be taxed at a preferential passthrough rate. It also isn’t clear whether passive owners—such as investors who don’t work in the business—would get a tax break close to what they would get in the House bill, which would give them a 25 percent rate on all the income they earn from the passthrough.

“It comes down to a choice—do you want a real 32 percent rate, or an inscrutably complex 25 percent rate that only applies to some of your income?” Donovan said.

Read the full piece here.

I spoke to Bloomberg‘s Ari Natter about the Senate tax bill’s surprising approach to energy policy:

“From an energy standpoint it’s an epic head fake,” said Liam Donovan, a tax lobbyist at Bracewell LLP. “I don’t think anybody in town would have guessed the Senate mark would be silent on energy, particularly after the waves that were made in the House.”

Read the full piece here.

To be clear, the surprise here was not that the Senate left the production tax credit (PTC) alone–clearly renewables have a stronger constituency within the Senate GOP conference than the house. The shocker was that the Senate failed to restore the orphaned tax credits that were left out of the 2015 phase-down deal. With the House proposal reinstating these credits, the Senate should have been a formality. Instead they chose to forego an energy title altogether.

I spoke to Politico‘s Bernie Becker for his Morning Tax tipsheet about the conspicuous lack of detail in the tax bill so far:

It’s understandable why Brady and his crew would want to wait until the last possible moment to let K Street know about the potential trade-offs in tax reform — i.e., which of their tax breaks might be on the blocks. “The goal here was to show enough cards to keep the broader business community at the table as long as possible, get a budget done, and hope at the other end that the totality of the bill (and the underlying political imperative) is compelling enough to overcome any parochial offenses that will inevitably show up the text,” Liam Donovan, a lobbyist at Policy Resolution Group, told Morning Tax.

Read the full piece here.