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 International tax reform should be tackled as the first step
toward a bigger rewrite of the U.S. tax code that would lower rates
and eliminate many narrow tax breaks, House Ways and Means Committee
Chairman Kevin Brady told Reuters in an interview on Friday.
Brady, a Texas Republican who took over the committee's gavel in
November, said he favors a U.S. corporate tax rate of less than 20
percent, substantially lower than the current top rate of 35
percent.
"My intention is to have a vote on an international tax proposal out
of Ways and Means this year," Brady said.
U.S. companies have been pushing for the United States to move to a
territorial tax system to make them more competitive against foreign
rivals that pay taxes only in local jurisdictions where they
operate.
 The United States government taxes corporate profits earned abroad
only when they are brought into the country. Some $2 trillion in
U.S. profits are sheltered overseas to avoid taxation, and Brady
said he wants to find a way to "lower the barriers and allow
companies to bring back their profits to be invested in the United
States."
He said that an international reform proposal by former Ways and
Means chairman Dave Camp for a one-time "holiday" taxing companies
on foreign profits held overseas at a far lower rate is "an awfully
good place to start."
Camp, who has retired from the House, favored taxing repatriated
cash profits at 8.75 percent and remaining earnings at 3.5 percent.
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Brady said that a broad "pro-growth" tax reform plan would require a
Republican president and was a project for 2017. He said a
bipartisan consensus was building for reform, to prevent U.S. firms
from moving headquarters overseas.
Brady also said he was not yet ready to declare whether he supported
the Trans-Pacific Partnership (TPP) trade deal because the pact
reached in October needs more study.
Although Senate Majority Leader Mitch McConnell has been quoted as
saying he would prefer to delay voting on TPP until after the
November 2016 elections, Brady declined to rule out a vote earlier
in the year. The timing would largely depend on member support for
the deal, he said.
"Let's not delay or hasten the timetable for a vote," he said.
(Reporting by Susan Cornwell and David Lawder; Editing by Grant
McCool and Bill Trott)
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