March 16, 2006
The House-Senate conferees on the Tax Reconciliation Package held their first meeting on Wednesday, March 15th. Senate Finance Committee Chairman Grassley (R-Iowa) and House Ways and Means Committee Chairman Thomas (R-Calif.) expressed their differing visions about the final product and the paths to getting it passed. Senator Grassley wants to coordinate with Democrats in the Senate to develop a package that can secure 60 votes. His package would include the extension of the alternative minimum tax patch, some extension of dividends and capital gains, and several revenue raisers.
Representative Thomas' position is to include only those provisions that can pass with a bare majority and require the filibuster protection that the Tax Reconciliation Package enjoys. Thomas would include a two-year extension of the dividends and capital gains tax. He would put forward a second bill that includes those provisions that would attract 60 votes in the Senate, such as the AMT patch and extension of a few other popular tax incentives.
This difference in visions and paths must be resolved before the Tax Reconciliation Package can move.
These differences combined with upcoming Congressional recesses do not bode well for quick action. Congress will be in recess during the week of March 20th. It returns for two weeks and then takes a two-week recess from April 10th to April 21st. There is no hard deadline for final action on this legislation.