Ways and Means Chair Neal Suggests Biden Plan May Drag Into 2022

Dec. 1, 2021, 11:29 PM

House Ways and Means Chair Richard Neal told reporters Wednesday that he is skeptical work on tax-and-spend legislation will be done by Christmas, the deadline Senate Majority Leader Chuck Schumer (D-N.Y.) set to pass the reconciliation package.

Neal (D-Mass.) said lawmakers have a number of issues that need to be addressed first, including the debt limit, which he described as an “immediate fuse that needs to be extinguished.” The Treasury Department has warned that it could exhaust its ability to cover the federal government’s debt obligations as soon as Dec. 15 if Congress doesn’t act, though the Congressional Budget Office this week suggested Treasury could buy some extra time by deferring a scheduled transfer to the Highway Trust Fund.

“It’s desirable to get it done” before the end of the year, Neal said of the reconciliation package. “But there’s a series of issues that have to be completed in the next couple weeks, so we should be addressing those pretty forcefully.”

Government funding also runs out this week, and the Senate is working on the annual national defense authorization, which is considered must-pass legislation.

Democrats still must work out intra-party issues over the cost of the overall tax-and-spend package, as well as make decisions on how to handle the $10,000 deduction cap on state and local tax payments, paid family leave, and other items. If negotiations go into next year, it would risk the expiration of several current programs, including the temporary expansion of the child tax credit. The more generous credit, established in the March pandemic aid law, would be extended through 2022 under the House-passed legislation.

Neal acknowledged expiration of the credit as a motivating factor to act before Jan. 1, but said Democrats would “have to do something to accommodate that tax credit, because we promised that it would not only be done for a year but in our provision go on for another year.”

To contact the reporter on this story: Colin Wilhelm in Washington at cwilhelm@bloombergtax.com

To contact the editors responsible for this story: Patrick Ambrosio at pambrosio@bloombergtax.com; Kathy Larsen at klarsen@bloombergtax.com

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