Senate Finance Bones Up for Brutal Budget Debates

Jeff Brabant, a vice president at the National Federation of Independent Business, emphasized the impact any changes could have on family-owned businesses.

“There’s a real concern that family businesses will more often than not be sold, and usually to larger businesses who don’t have the same footprint in the community,” Brabant said.

Barrasso shook his head over Brabant’s remarks.

“We have a celebration each year for those that have kept the ranch in the family for a hundred years,” Barrasso said. “There are families that have been through drought, fire, terrible winters, all of it, and yet their biggest thread is the federal government.”

Bunn presented data suggesting is that the U.S. tax code is much more “progressive,” or tougher on higher-income taxpayers and easier on lower-income taxpayers, than critics say it is.

“In 2021, the top 1% of taxpayers paid 45.8% of the taxes owed,” Bunn said.

In 2019, he said, the bottom fifth of U.S. taxpayers had a negative 127% effective tax rate and the top fifth had a 30.7% effective tax rate.

“So the U.S. tax system is incredibly progressive,” Bunn said.

Finseca’s view: Finseca is one of the financial services groups that’s been in suspense about what would happen at the hearing.

Marc Cadin, Finseca’s chief executive officer, said in a statement that Finseca believes that life insurance is taxed appropriately and is the foundation of a holistic financial plan.

“The Joint Committee on Taxation recognized the appropriateness of the tax treatment of inside build-up when they removed it from the tax expenditure list in 2015,” Cadin said. “Over the past several months, Finseca has had multiple discussions with the Senate Finance Committee members, including Chair Wyden and his staff making our position clear. Finseca has also given hundreds of presentations to thousands of members of the profession over that same time period and can unequivocally state that the industry is unified in our position.”

Senate Finance Committee members skirmished at a hearing last week over the next big battle over tax policy. Credit: Senate Finance Committee