March 24 (Bloomberg) — The House Ways and Means Committee will begin debating which of 55 lapsed U.S. tax breaks should be extended permanently or dropped, potentially affecting a broader revamp of the tax code.
In a memo to committee members today, Chairman Dave Camp said the panel will look at the tax breaks starting in April, going "policy by policy." The most significant benefits that expired Dec. 31 include the research and development tax credit used by companies such as Intel Corp. and a foreign tax provision used by Citigroup Inc. and Caterpillar Inc.
"We can all agree that a short extension of tax policies is no way to legislate and is even worse for the families and businesses who utilize those tax benefits," Camp wrote in the memo obtained by Bloomberg News.
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Camp proposed a draft revamp of the U.S. tax code Feb. 26 that would lower tax rates and end many breaks. To set his revenue target, he assumed, as does the Congressional Budget Office, that none of the expired breaks would be revived.
Making a shift to assume that some of those breaks would remain in the code would lower the revenue target. That would give Camp room — as much as $900 billion over a decade — to restore tax breaks he proposed eliminating.
Camp also wrote in the memo that the committee would begin moving forward on legislation to make "incremental progress towards full reform."
During a hearing earlier this month, Camp suggested that Congress could consider legislation to consolidate and simplify tax breaks for higher education.
Camp's broader bill is stalled because of partisan fights over revenue and objections to many of the plan's details.
Separately, the Senate Finance Committee may vote next week on a one-year or two-year extension of many of the expired tax breaks. The details of that plan haven't been released.
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