Ways & Means Committee:
Hearing Advisory: Chairmen Camp and Baucus Announce Joint Hearing on Tax Reform and the Tax Treatment of Debt and Equity
FOR IMMEDIATE RELEASE
Ways and Means (202) 226-4774
Senate Finance (202) 224-4515
Congressman Dave Camp (R-MI), Chairman of the House Committee on Ways and Means, and Senator Max Baucus (D-MT), Chairman of the Senate Committee on Finance, today announced that the Committees will hold a joint hearing to review the tax treatment of debt and equity and to consider distinctions in the treatment of each in the context of comprehensive tax reform. In connection with the hearing, the staff of the Joint Committee on Taxation (JCT) will release two reports that analyze the taxation of household debt and business debt. The joint hearing will take place on Wednesday, July 13, 2011, in Room HVC-210 of the Capitol Visitor Center, beginning at 9:00 A.M.
At the March 15, 2011 organizational meeting of the Joint Committee on Taxation, Chairman Camp and Chairman Baucus – in their capacities as JCT Chair and Vice Chair, respectively – directed JCT staff to analyze how debt financing is taxed relative to equity financing and to report on the effects of such differences on household and business debt levels. Chairman Camp and Chairman Baucus believe that the policy and economic information provided by JCT staff will be important for the tax-writing committees to consider in the formulation of comprehensive tax reform legislation. The two JCT reports will be formally presented to the Ways and Means Committee and Senate Finance Committee at the joint hearing.
With regard to the joint hearing, Chairman Camp made the following statement:
“The relative taxation of debt and equity has serious consequences for the economy and job creation, and it needs to be given careful consideration in the context of comprehensive tax reform. With both the Ways and Means Committee and the Senate Finance Committee actively pursuing tax reform, it will be critical for Congress’s two tax-writing panels to be working together closely. I look forward to having our two committees convene this historic joint hearing – the first on a tax issue since 1940 – to receive these staff reports on this important issue.”
Chairman Baucus said, “As part of tax reform, we must examine how we can improve our economy and create jobs, and to do so, we need to ask how to encourage businesses to invest in growth. This hearing will look at the effects of different tax treatment of debt and equity on our economy. We’ll need to work together to simplify and improve our tax code to help businesses create jobs, which is why these joint hearings between our two committees are so important.”