Infrastructure Debate Continues

July 21, 2021

The bipartisan infrastructure framework continues to dominate discussions in Washington, D.C. with Senate Majority Leader Chuck Schumer (D-N.Y.) scheduling a procedural vote today (Wednesday, July 21) in a bid to move negotiations along nearly a month after the framework was first announced. Given that House Speaker Nancy Pelosi (D-Calif.) said she wouldn’t take up the bill until the Senate passed it’s up to the Senate to move discussions along to produce actual legislation. The GOP 10 Senators who are negotiating with Democrats have urged Schumer to postpone the vote and give them until early next week to produce the legislative package, which the group has indicated will be Monday.

Beyond today’s ever-evolving procedural maneuverings on the legislative package, lawmakers have dropped the plan to use reducing the tax gap as a pay-for for the infrastructure package, a setback for the bipartisan measure ahead of the upcoming deadline for agreement.

This shift came after a pushback from Republicans, who were wary of granting the Internal Revenue Service (IRS) more money and power, and the plan to reduce the tax gap required boosting tax-collecting enforcement at the IRS.

President Joe Biden has said he wants to invest $80 billion in IRS technology and enforcement to increase collections of taxes by $700 billion over 10 years. The provision which was proposed in the infrastructure bill would have accounted for around $100 billion of that larger goal.

This change means that the plan to strengthen IRS enforcement for tax collection has stalled, even though some lawmakers are saying it could be revived in the separate spending package pushed by Democrats.

The decision also means that lawmakers need to find another way to pay for infrastructure spending.

NSBA has been outspoken against unfair IRS enforcement on small business and is urging small businesses to weigh in with their lawmakers here.