The odds in favor of a December passage of the Build Back Better Act (BBBA) seem to be slipping. Even with Friday's passage of a continuing resolution to avoid a government shutdown, Congress still needs to address several "must pass" items (the annual defense authorization bill, the federal debt limit) before year end. Further, since House passage of the BBBA, little progress has been made in the Senate where the "Byrd Bath" by the Senate Parliamentarian is taking longer than expected and negotiations over major tax and non-tax provisions, including the SALT deduction cap and the immigration provisions, continue with no resolution seemingly near. In addition, Senator Joe Manchin (D-WV), the key swing vote, does not appear to be in any rush to address the legislation this year. Key Democratic members of the House Committee on Ways and Means seem to have given up almost all hope of their Senate colleagues passing the bill before December 24, speculating that without a Christmas miracle, January passage seems much more likely.
 
Clearly, while year end has long been considered the drop dead date for passage of the BBBA, it is evident that at least some policymakers are beginning to seriously contemplate consideration of the package lasting until early January. We still believe that the Senate will make every effort to enact the BBBA before December 31, as the political calculus and prospects for enactment change considerably with the turn of the calendar year. It may be significantly harder for the BBBA to pass in 2022, given the lack of a natural deadline to force action and the optics of voting for such a significant spending and tax package in the actual mid-term election year. Given the narrow Democratic majorities in both the House and Senate, only a few members in the House and even one member in the Senate may shift their vote based on the campaign implications of voting on significant tax increases close to their respective elections. Moreover, passage after December 31 would create some headaches regarding the retroactivity of the provisions that are slated to go into effect for tax years beginning in 2022. Thus, while the process and status of the substantive negotiations of the BBBA may be making January consideration more likely, such a shift in timing may have a significant detrimental impact on the bill's prospects for enactment. #TaxTake

Upcoming Speaking Engagements and Events

On December 7, Loren will speak at the 2nd Annual IFA USA Winter International Tax Conference. Loren's panel is titled, "Legislative Landscape in Light of Potential Tax Reform."

In the News

Marc was named a 2021 Top Lobbyist by The Hill.
 

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