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The Baucus-Camp Tax Road Show Faces Obstacles

LAWRENCEVILLE, N.J. — Give them credit for this much: The top congressional tax writers are doing their level best to push for an overhaul of the nation’s outdated tax code.

Senate Finance Chairman Max Baucus, D-Mont., and House Ways and Means Chairman Dave Camp, R-Mich., have their own website, a Twitter handle and a road show.

The problem for Baucus and Camp is not Americans’ lack of interest in seeing their taxes get simpler — and possibly lower — but in the stark ideological differences between rank- and-file lawmakers when it comes to tax issues. And the leaders of their respective parties have taken a wait-and-see approach to the bicameral effort, which has hampered momentum in the halls of Congress.

Still, the novelty of having two chairmen of different parties working together on such an ambitious political task has drawn national attention; several major publications sent reporters to the duo’s first event in Minneapolis on July 8, and NPR, The New York Times and CQ Roll Call were among those that made a trip to the Philadelphia area on Monday.

That sojourn took Baucus and Camp to a third-generation appliance retailer in suburban New Jersey for an event that felt more like the lonely travails of a long-shot candidate for president who has to appear interested — as Baucus and Camp did — in the latest oven technology.

“It makes a big difference to get out of Washington, believe me,” Baucus told local reporters during a truncated media availability after the event at the appliance retailer.

But Sen. Charles E. Grassley, a former Finance Committee head, said the two chairmen face tough odds, regardless of whether they travel outside the Beltway to drum up interest in a tax policy rewrite.

“It might not be productive, but in — in public policy, you never know for sure if something’s going to work. So, if there’s no known negative, you ought to do it. So, in this case there’s no known negative, so they ought to do it,” Grassley said. “I believe the necessity of tax reform is complicated. You gotta educate the public about it. The ideal thing would be to have tax reform be part of a presidential campaign, you know, where you get a mandate to do it.”

Grassley compared the effort to a 1998 campaign-style tour by former Republican Reps. Dick Armey of Texas and Billy Tauzin of Louisiana, who held a series of forums. Tauzin advocated for tossing out the 1986 tax code and replacing it with a national sales tax. Armey pushed for a flat-rate income tax. Neither was successful.

Still, “Max and Dave,” as the chairmen are calling themselves, attempted to make the best of their visit to Mrs. G TV and Appliances, which sits on a stretch of Route 1, adjacent to a parcel that currently houses an abandoned diner.

Mrs. G’s regularly hosts events and cooking classes in the showroom, which features a functioning kitchen. Baucus and Camp were treated to a frittata, chocolate-dipped strawberries and — when in Jersey — blueberry smoothies.

The lawmakers sat around a kitchen counter with owner Debbie Schaeffer and Maguerite Mount, the managing director of the firm that handles Mrs. G’s outside accounting and tax preparation.

Inside the Beltway, the lawmakers have gotten into the procedural weeds, as was the case during a joint appearance July 18 at the Economic Club of Washington. Camp said then that the two men would work together to determine which chamber should move first.

July 26 was the deadline for senators to submit suggestions for preserving tax preferences to the Finance panel, as requested by Baucus and his ranking member, Utah Republican Orrin G. Hatch. But the proposals some senators decided to make public only seemed to highlight the partisan divide on taxes, with Democrats arguing to preserve tax credits for child care and earned income and Republicans making the case for lower taxes on businesses and eliminating the estate tax.

Baucus hopes to mark up a Senate version of the plan in the fall. But Senate Majority Leader Harry Reid, D-Nev. suggested last week that a tax overhaul is not on his floor schedule. Reid also pushed back against the idea of a tax overhaul that doesn’t raise substantial new revenue — on the order of the nearly trillion dollars over a decade called for in the Senate Democratic budget.

Reid’s comments set off an exchange of statements, with Baucus saying, “I have always said that I think the Senate bill needs to raise revenue” and top Senate Republicans releasing a letter calling for revenue neutrality. But that debate was entirely absent from the trip to New Jersey.

It didn’t go entirely as planned: Baucus was late to arrive from D.C. thanks to mechanical difficulties with his Amtrak train. And even at a friendly venue like Mrs. G’s, there were signs of the difficulty both men face as they look to eliminate most tax deductions while lowering overall rates for individuals and businesses.

“We certainly wouldn’t want to give up our depreciation, but would relish simplification of depreciation rules,” Mount told reporters, referencing tax laws that allow businesses to deduct some business expenses.

Mount, however, got to the crux of the problem when asked about which tax preferences should be eliminated as part of an overhaul.

“I think that’s a difficult question to answer,” Mount said. “Businesses, you have to realize, the deductions that businesses are able to take, are deductions that is their cost of doing business. They’re directly related to how they generate their revenue. … Perhaps somewhere in the area of some of the more softer business expenses you could consider giving up in exchange for lower rates,” Mount eventually conceded.

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