REPORT: Wall Street Going To War Over Tax Reform Bill

Wall Street is reportedly up in arms over a tax reform plan released by Republican Rep. Dave Camp this week. According to a report in Politico a “GOP lobbyist with knowledge of the conversations” said finance firms have reached out to Republicans to say fundraising commitments have been “canceled for the foreseeable future.”

Camp’s proposal would be a sweeping overhaul of the tax code that would have a negative impact on some financial firms, particularly in private equity. Among other things, it would raise taxes on financial institutions with more than $US500 billion in assets and would close the “carried interest” loophole that allows hedge fund and private equity profits to be taxed at a lower rate. Politico reported lobbyists for Bank of America, JPMorgan Chase, Goldman Sachs, and others are “meeting privately with lawmakers” to explain the effects of the bill.

The plan isn’t expected to get a vote on the House floor. Both Republicans and Democrats have distanced themselves from the plan. Camp is in his final year as chair of the Ways and Means Committee and many observers have suggested he’s eager to make a splash on the way out. Still, his proposal could encourage others to float certain elements of the plan in future negotiations.

However, some Republican lawmakers who spoke to Politico suggested Camp’s plan could help them with Wall Street by letting them make their opposition clear. Ohio Republican Rep. Patrick Tiberi, who is a member of the Ways and Means Committee, predicted financial fundraisers won’t unleash their wrath on the party as a whole and would instead react to individual politicians depending on whether or not they backed Camp’s plan.

“It might impact Chairman Camp’s relationship with that sector,” Tiberi said. “I think individual members, depending on how they do support or don’t support, I think it’ll be based on that.”

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