Overnight Finance: Ryan wants tax reform to be permanent | White House expects tax bill ready by September | Defense spending battle delays budget

Ryan calls for tax reform to be permanent: Speaker Paul Ryan (R-Wis.) said Tuesday that tax reform should be permanent, even as other GOP lawmakers, administration officials and prominent conservatives have expressed openness to temporary tax cuts.

“These reforms, these tax cuts, they need to be permanent,” Ryan said in a speech before the National Association of Manufacturers (NAM), to applause from the audience.

“Businesses need to have confidence that we won’t pull the rug out from under them,” he added. “They need the certainty from permanent tax cuts to hire more workers, to invest in their businesses, and to plan for the future.”

{mosads}Congressional Republicans have said they want to pass tax reform legislation through a special budget process in order to avoid a filibuster by Democrats. But in order for a bill to be considered under reconciliation, it cannot increase the deficit outside of the budget window, which is usually 10 years. The Hill’s Naomi Jagoda reports: http://bit.ly/2sTrVIB.

 

Mnuchin: Policymakers ‘100 percent committed’ to getting tax reform this year: Treasury Secretary Steven Mnuchin on Tuesday expressed confidence that tax reform legislation will pass this year.

“The speaker, myself, the Senate leadership, we are all 100 percent committed to getting it done this year,” Mnuchin told CNBC. “It’s critical to the economy, we have a unique opportunity to do this, it’s been 30 years, we have to fix the system.”

Mnuchin’s comments come ahead of Speaker Paul Ryan’s (R-Wis.) speech Tuesday on tax reform at a National Association of Manufacturers event.

When asked whether policymakers are pursuing tax reform or tax cuts, Mnuchin said that administration officials want to do both. Here’s more from Naomi: http://bit.ly/2sSSCgw.

 

GOP defense spending battle delays Republican budget: Republicans on the House Budget Committee are talking about increasing defense spending beyond President Trump’s proposed $54 billion boost, which has led to an impasse between defense hawks and deficit hawks.

The fight has forced the committee to postpone the rollout of its 2018 budget resolution, a key element in moving Trump’s legislative agenda forward.

The House GOP may have the opportunity to settle on a strategy when it meets for its weekly policy discussion this Wednesday, a meeting that will focus on budget and appropriations. 

A House GOP aide with knowledge of the process said it would be “a very strong possibility” that the defense cap proposed in the House budget resolution would be higher than Trump’s request of $603 billion for the next fiscal year.

In his budget proposal, Trump cut $54 billion from nondefense discretionary spending to pay for the new defense spending. The Hill’s Niv Elis explains: http://bit.ly/2sSSjCo.

 

Happy Tuesday and welcome to Overnight Finance. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

See something I missed? Let me know at slane@digital-stage.thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://bit.ly/1NxxW2N.

 

On tap tomorrow

• Senate Finance Committee: Hearing on the White House proposed budget request for fiscal 2018 and the trade policy agenda, 10 a.m. http://bit.ly/2s9dHls
• House Financial Services Committee: Continuation of a markup of various flood insurance bills, 10 a.m. http://bit.ly/2rE8j6q.
• House Appropriations Subcommittee on Financial Services: Budget hearing for the Office of Management and Budget, 2 p.m. http://bit.ly/2rE81N5.
• House Financial Services Subcommittee on Monetary Policy and Trade: Hearing entitled “Monetary Policy v. Fiscal Policy: Risks to Price Stability and the Economy,” 2 p.m., http://bit.ly/2s9nsQP.

 

Ford to move production of Focus from Mexico to China: Ford Motor Co. is moving production of its Focus model to China after production at its Michigan plant ends in 2019.

The move, which Ford estimates will save it $500 million in production costs for the car, comes as the company has become a target of President Trump, who is pressuring manufacturers to keep jobs in the United States.

Ford initially planned to move production of the Focus to Mexico, but it is now scrapping that plan in favor of production in China, according to a report in Bloomberg.

Trump thanked Ford on Twitter for its decision to scrap the Mexican plant: http://bit.ly/2sSXGBn.

 

Biz groups hail Trump’s labor board pick: Business groups are hailing President Trump intention to nominate attorney Marvin Kaplan to fill one of two vacancies on the five-member National Labor Relations Board (NLRB).

The groups say Kaplan, who now serves as chief counsel of the Occupational Safety and Health Review Commission, marks the first step in an expected shift in control from Democrats to Republicans.

If confirmed, Kaplan would be the second Republican on the currently three-member panel alongside Philip Miscimarra, whom Trump named as board chair in January.

“Marvin Kaplan will begin to restore balance to an agency whose recent and radical decisions and disregard for long standing precedent have injected uncertainty into labor relations to the detriment of employees, employers and the economy,” Kristen Swearingen, chair of the Coalition for a Democratic Workplace, said in a statement. The Hill’s Lydia Wheeler has more: http://bit.ly/2rArKhl.

 

Cohn: Tax legislation will be released in early fall: White House chief economic adviser Gary Cohn said that he expects a tax reform bill will be considered by Congress in September.

Cohn made the remarks during a White House meeting on Tuesday with leaders from trade associations representing the interests of the technology and telecom industries. 

Treasury Secretary Steven Mnuchin, who had previously expressed confidence that tax reform legislation will pass by the end of the year, was also in the meeting.

Cohn, who is also the director of the National Economic Council, said President Trump has taken a keen interest in the proceedings on a tax proposal, saying that he calls “every day” to speak about its progress about it. The Hill’s Ali Breland takes us there: http://bit.ly/2sT5S4E.

 

Schumer: Tax cut may derail debt-ceiling increase: Senate Minority Leader Charles Schumer (D-N.Y.) on Tuesday warned that Democrats may block an effort to raise the federal debt ceiling if Republicans move to slash taxes.

President Trump has vowed to pass the biggest tax cut in history and Republican negotiators have been laying the groundwork for a tax reform package for weeks.

But that may make it tougher for GOP leaders to count on Democratic votes to help raise the debt ceiling next month.

“If they’re going to put on a massive tax cut for the very wealthy that increases the deficit by trillions, it’s harder to get Democrats to increase the debt ceiling,” Schumer told reporters: http://bit.ly/2rA4n7H.

 

Club for Growth bashes border tax ahead of Ryan speech: The conservative Club for Growth is urging congressional Republicans to oppose the border-adjustment tax ahead of a major speech on Tuesday by Speaker Paul Ryan (R-Wis.), who proposed the measure.

“The biggest impediment to pro-growth tax reform is the Border Adjustment Tax (BAT),” Club for Growth President David McIntosh said in a statement. “It is a political loser. The BAT has become a ball and chain that is dragging down real, pro-growth tax reform.”  

Under the border-adjustment proposal, imports would be subject to the U.S. corporate tax while exports would be exempt. The tax was a key element of the tax reform blueprint that Ryan released last year, and supporters of the proposal argue that it would help to encourage domestic manufacturing.

But retailers, conservative groups, Trump administration officials and many GOP lawmakers have raised concerns that the BAT would translate to a tax increase for consumers: http://bit.ly/2sTsq59.

 

House passes nuclear energy tax credit: The House quickly passed a bill extending a nuclear energy tax credit on Tuesday. 

The bill, bipartisan legislation from Reps. Tom Rice (R-S.C.), Earl Blumenauer (D-Ore.) and others, would increase the number of utilities that can qualify for the tax credit and remove construction deadlines for facilities that use it. 

The House passed the bill, which would cost $16 million over 10 years, on a voice vote.

The legislation lifts a requirement that nuclear facilities be placed into service by the end of 2020 in order to receive the 1.8-cent-per-kilowatt-hour tax credit. 

It would also allow government-owned utilities and nonprofit electric co-ops to receive the credit and give them the power to transfer credits to other partners on the facilities, such as the projects’ designers. 

The bill is especially important for the states of Georgia and South Carolina, the only two states where new nuclear power plants are under construction.

The Hill’s Devin Henry has more here: http://bit.ly/2rSLHzh

  

White House eyes foreign investment for infrastructure plan: The White House believes that foreign investment will be key to fulfilling President Trump’s promise to upgrade U.S. roads, bridges, airports and other public works, officials said Tuesday.

Treasury Secretary Steven Mnuchin said that the success of President Trump’s $1 trillion infrastructure package — which is expected to rely heavily on the private sector — will likely depend on help from foreign investors.

“Working with foreign investors is going to be a critical part of any plan we put forward,” Mnuchin said at the SelectUSA Investment Summit in Washington. “Public-private partnerships are crucial to ensuring that the American taxpayer does not bear the full cost of any proposed program.”

A number of foreign investors, including in Australia, Canada, Europe and the Middle East, already invest in U.S. infrastructure.

The Hill’s Melanie Zanona has the details here: http://bit.ly/2tqmqOY

 

Write us with tips, suggestions and news: slane@digital-stage.thehill.com, vneedham@digital-stage.thehill.com, njagoda@digital-stage.thehill.com and nelis@digital-stage.thehill.com. Follow us on Twitter: @SylvanLane,  @VickofTheHill, @NJagoda and @NivElis