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Chairmen Camp and Baucus Announce Joint Hearing on Tax Reform and the Tax Treatment of Capital Gains
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 capital gains in the context of comprehensive tax reform. The joint hearing will take place on Thursday, September 20, 2012, in Room HVC-210 of the Capitol Visitor Center, beginning at 10:00 A.M.
This hearing was originally scheduled for 10:00 A.M. on Thursday, June 28, 2012, in Room HVC-210 of the Capitol Visitor Center, but was postponed.
In view of the limited time available to hear witnesses, oral testimony at this hearing will be from invited witnesses only. However, any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Committees and for inclusion in the printed record of the hearing. Invited witnesses will include the witnesses who were invited to appear at the originally scheduled hearing.
The maximum capital gains tax rate currently is 15 percent, as compared to the maximum individual ordinary income tax rate of 35 percent. Absent Congressional action, the maximum statutory capital gains rate will increase to 20 percent on January 1, 2013, while the maximum individual ordinary income tax rate will increase to 39.6 percent. Beginning in 2013, however, an additional 3.8 percent tax will be imposed on net investment income earned by certain individuals. “Net investment income” includes, among other items, capital gains. Furthermore, the 2013 scheduled restoration of the “Pease limitation” on itemized deductions will impose a roughly 1.2 percent marginal rate on capital gains, bringing the top federal rate on capital gains to 25 percent in 2013.
With regard to the joint hearing, Chairman Camp made the following statement:
“The taxation of capital gains is one of the most widely discussed areas of our individual tax system, and it needs to be reviewed as part 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 continue working closely together. This is the third time this Congress that our two committees have convened a joint hearing, and I look forward to continuing the dialogue on these critical issues.”
Speaking about the upcoming hearing, Chairman Baucus said, “It has been more than 25 years since the last major tax reform occurred. The world has changed drastically in that time and America’s tax code hasn’t kept up. It’s time we had a tax code for the 21st century, one that can create jobs, spark innovation and expand opportunity. I look forward to working with Chairman Camp as we work on a balanced, common-sense plan to reform the tax code and create the jobs we need to improve our economy.”
FOCUS OF THE HEARING:
The hearing will focus on the taxation of capital gains in the context of comprehensive tax reform. It will explore several tax reform policy issues relating to the treatment of capital gains, including background on capital gains taxation and its history, the impact of the capital gains tax rate on investor behavior, the treatment of capital gains as compared to ordinary income, the revenue-maximizing rate on capital gains, the distribution of capital gains income across taxpayer income levels, and the types of assets eligible for capital gains treatment.
DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:
Please Note: Any person(s) and/or organization(s) wishing to submit written comments for the hearing record must follow the appropriate link on the hearing page of the Committee website and complete the informational forms. From the Committee homepage, http://waysandmeans.house.gov, select “Hearings.” Select the hearing for which you would like to submit, and click on the link entitled, “Click here to provide a submission for the record.” Once you have followed the online instructions, submit all requested information. ATTACH your submission as a Word document, in compliance with the formatting requirements listed below, by the close of business on Thursday, October 4, 2012. Finally, please note that due to the change in House mail policy, the U.S. Capitol Police will refuse sealed-package deliveries to all House Office Buildings. For questions, or if you encounter technical problems, please call (202) 225-3625 or (202) 225-2610.
The Committee relies on electronic submissions for printing the official hearing record. As always, submissions will be included in the record according to the discretion of the Committee. The Committee will not alter the content of your submission, but we reserve the right to format it according to our guidelines. Any submission provided to the Committee by a witness, any supplementary materials submitted for the printed record, and any written comments in response to a request for written comments must conform to the guidelines listed below. Any submission or supplementary item not in compliance with these guidelines will not be printed but will be maintained in the Committee files for review and use by the Committee.
1. All submissions and supplementary materials must be provided in Word format and MUST NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised that the Committee relies on electronic submissions for printing the official hearing record.
2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material not meeting these specifications will be maintained in the Committee files for review and use by the Committee.
3. All submissions must include a list of all clients, persons and/or organizations on whose behalf the witness appears. A supplemental sheet must accompany each submission listing the name, company, address, telephone, and fax numbers of each witness.
The Committee seeks to make its facilities accessible to persons with disabilities. If you are in need of special accommodations, please call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event (four business days’ notice is requested). Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above.
Note: All Committee advisories and news releases are available on the World Wide Web at http://www.waysandmeans.house.gov/.