By Caitlin Reilly
CQ-Roll Call
(TNS)
Lobbyists this year have stressed the need for companies to engage early on next year’s expiring tax provisions, warning of the compressed timeline and the possibility that any issue could land on the chopping block amid long wish lists and pressure to curtail deficits.
It seems the private sector got the message, if quarterly lobbying disclosures filed Monday are anything to go by. Mentions of the expiring 2017 tax cuts in lobbying filings increased sharply last quarter, up 33% from the second quarter and 67% from the first three months of the year. Interest in the expiring provisions is likely higher than is captured in reports citing the law, as many filings cite specific policies, rather than the law by name.
In contrast, mentions of the $79 billion family and business tax break package in lobbying filings declined over the same period, despite Senate floor action last quarter, possibly reflecting growing cynicism about the bill’s chances amid opposition from Senate Republicans.
Companies often cited the 2017 law’s corporate and international tax provisions in lobbying reports. Expedia Group Inc., FedEx Corp., Honda Motor Co. Ltd., Garmin Ltd., Google and Toyota Motor Corp. were among the companies that disclosed lobbying on the 2017 law’s international provisions, some of which are slated to become less generous to businesses when the law expires.
Toyota and Garmin lobbied on the 2017 law’s Base Erosion and Anti-Abuse Tax or “BEAT” tax, which limits companies’ ability to shift profits to affiliates in lower-tax countries, while Google pushed to make permanent the current deduction for foreign-derived intangible income, which will drop at the end of next year.
Other companies that reported lobbying on the expiring law last quarter included Anheuser-Busch Companies, Airbnb Inc., Kraft Heinz Co., Nestlé S.A., Pfizer Inc. and Starbucks Corp., among others.
While many are lobbying to maintain favorable provisions from the 2017 law, other groups see next year’s tax bonanza as an opportunity to reverse or tailor policies they object to. Restoring the full, upfront deduction of research and development investments has a ton of backing by the businesses and their advocates, but other smaller 2017 tax casualties got attention last quarter.
The American Federation of Musicians last quarter reported lobbying to reinstate an above-the-line deduction of expenses for performing artists that was removed by the 2017 law. The group backed a bill introduced by Ways and Means member Rep. Vern Buchanan, R- Fla., that would revive the deduction for artists making less than $100,000.
More broadly, tax issues in general caught the interest of K Street’s biggest spenders last quarter, with most of the top 10 high-rollers reporting lobbying activity related to tax policy.
Some of the top names disclosing tax lobbying last quarter include the U.S. Chamber of Commerce, National Association of Realtors, American Chemistry Council, American Medical Association, Meta Platform Inc., AARP, Amazon.com Services and Business Roundtable. Only two of the top 10 biggest spenders last quarter didn’t report lobbying on tax issues: Pharmaceutical Research and Manufacturers of America and the American Hospital Association.
New tax-related business on K Street also grew during the third quarter compared to the previous one, with 82 lobbying registrations citing interest in tax issues filed from July through the end of September. Overall, new tax business is on pace to exceed lobbying registrations from last year, thanks in large part to a flurry of hiring during the first quarter, when the bipartisan tax package seemed poised to move.
The financial services sector proved fertile ground for new business last quarter, with private equity titan Carlyle Group hiring BakerHostetler to work on “multiple provisions” related to the expiring 2017 law; JPMorgan Chase & Co. hiring PhronesisDC; and BlackRock Funds hiring Empire Consulting.
Online payments providers also got in on the action, with Block Inc. hiring Zero One Strategies to work on issues related to digital assets and Stripe Inc. hiring Fierce Government Relations to work on the expiring 2017 tax law.
The third quarter saw legislative action on a handful of policy issues subject to steady lobbying throughout the year, though last quarter attracted some new interest.
A bill to raise the threshold for reporting online payments for tax purposes approved by the House Ways and Means Committee in September found steady support from parts of the online payments industry and online platforms that connect buyers and sellers, such as Airbnb, Etsy Inc., eBay Inc., PayPal Holdings Inc. and StubHub. But the bill picked up a powerful new backer last quarter: the National Federation of Independent Business, an influential small business lobby that typically supports Republicans and tax-friendly policies.
_______
©2024 CQ-Roll Call Inc., All Rights Reserved. Visit cqrollcall.com. Distributed by Tribune Content Agency LLC.
Thanks for reading CPA Practice Advisor!
Subscribe Already registered? Log In
Need more information? Read the FAQs
Tags: Income Tax, Legislation, Taxes
