The change doesn’t go into effect until 2027, when its impact would start to be felt, increasing revenue by $7.8 billion over the following five years, according to the Joint Committee on Taxation. Considering corporate income taxes are already projected to bring in $1.9 trillion during that timeframe, according to the Congressional Budget Office, the tighter executive pay deduction was a small price to pay to fit the relief package into the budget resolution’s constraints.
“This provision raised revenue to ensure we met our targets,” a Senate Democratic aide, speaking on the condition of anonymity, said in explaining the rationale.
Rep. Lloyd Doggett, D-Texas, a senior Ways and Means member who’s complained for years that mega corporations face too few constraints on pay packages, applauded the Senate move. He’d go even further with legislation that would bar deductions of compensation to any employee making more than $1 million at a public company, rather than just the top 10 executives.
Doggett said his bill, which would take effect right away, would bring in $27 billion over a decade.
Familiar turf for GOP
Garrett Watson, senior policy analyst at the Tax Foundation, doesn’t expect to hear much criticism from Republicans since their 2017 tax cuts established the current policy to help offset a little of the $1.5 trillion cost. That legislation, also enacted under reconciliation procedures, bumped from four to five the number of million-dollar compensated executives whose pay couldn’t be written off.
Go to Source
Powered by WPeMatico