NFL owners dodged a bullet in the new tax bill, which preserves the league’s ability to tap into taxpayer money to build stadiums.
The owners are one of a number of special interest groups breathing sighs of relief after the GOP toyed with eliminating their tax break, but ultimately left it intact.
A flurry of last-minute objections also led to Republicans preserving deductions for student loans, medical expenses, electric cars, teacher supplies and graduate school tuition waivers.
And the final bill tweaks, but does not end, the so-called “carried interest loophole,” which allows certain financial managers to pay a lower tax rate on some of their investments.
President Trump had repeatedly called for axing the break, and White House economic adviser Gary Cohn said they “probably tried 25 times” to get rid of it in negotiations, but hedge fund and private equity interests were too powerful.
“The reality of this town is that constituency has a very large presence in the House and the Senate. They have really strong relationships on both sides of the aisle,” Mr. Cohn said Wednesday at an event hosted by the website Axios. “We just didn’t have the support on carried interest.”
House Minority Leader Nancy Pelosi said that was a major black mark against Mr. Trump.
“Maybe he didn’t communicate this to the Republicans in Congress, or maybe they just used him as their frontman, but they didn’t do that,” she said Wednesday.
Republican Kevin Brady, the House’s top tax-writer, brushed aside the criticism, saying the carried interest loophole is a relatively minor item in the broad context of a $1.5 trillion tax overhaul.
“Carried interest, we can talk about that for the next hour if you’d like, but for most Americans, they [could] care less about that,” he said on MSNBC. “They care about their paychecks and getting the economy going.”
Mr. Trump also didn’t get his way on stadiums.
In the heat of the NFL player protests against the National Anthem the president said it was time to rethink the league’s benefits by denying them access to tax-free municipal bonds.
“Why is the NFL getting massive tax breaks while at the same time disrespecting our Anthem, Flag and Country? Change tax law!” the president tweeted in October.
The original House version of tax cuts prohibited all sports teams from tapping tax-free municipal bonds — but the Senate won out, and the break was maintained.
Sen. Cory Booker, who has been pushing a separate measure with Sen. James Lankford to repeal the break, said it was ridiculous that their proposal was ultimately set aside.
“Insane that my bipartisan bill ending sweetheart tax giveaways for NFL stadium construction doesn’t get included,” Mr. Booker, New Jersey Democrat, tweeted this week. “They are preserving so many tax gifts for the most privileged while ending breaks for low and middle income Americans.”
Amid pushback from powerful realtor and homebuilder groups, tax-writers also ended up splitting the difference between the House and Senate plans on the popular mortgage interest deduction, setting a $750,000 cap for new purchases.
That’s down from the current limit of $1 million but higher than the $500,000 cap in the House plan.
Like with many provisions crafted to comply with strict budget rules, the $750,000 limit is temporary and will revert to $1 million starting in 2026.
The Washington Times
By David Sherfinski
Wednesday, December 20, 2017