Jorge Castro Discusses Congressional Democrats' Tax Agenda in Tax Notes
"Baucus Lends Name to Stepped-Up Basis Fight"
Tax Member Jorge Castro, former Democratic Congressional tax aide and Counselor to the IRS Commissioner during the Obama administration, discussed the prospects of President Biden’s stepped-up basis tax proposal, a key revenue raiser to help fund the Administration’s priorities. In a September 1 op-ed in The Wall Street Journal by former moderate Democratic Senators Max Baucus (D-MT) and Heidi Heitkamp (D-ND), the Senators opposed the proposal. Baucus’ and Heitkamp's opposition is well respected by moderates in the Democratic party, so the pair's opinions could take away political cover for members in the House and Senate to support Biden's proposal, Castro said. And unlike in 2017 when Republicans coalesced to enact nearly $2 trillion in tax cuts under the Tax Cuts and Jobs Act (TCJA), Democrats face the more difficult challenge of wrangling total unanimity among their members in the Senate and near unanimity in the House on a package that is expected to raise considerable tax revenue, according to Castro. "It's much easier to dole out tax benefits and tax cuts than tax hikes," he said. But Democrats also have a wide array of other tax policies to consider besides stepped-up basis — changes to section 199A, the corporate tax rate, and international taxation, among others, Castro noted. "At the end of the day, this is going to be about the House Democratic caucus and the Senate Democratic caucus, and what they can negotiate."