Rep. Paul Ryan (R-Wisconsin), the Speaker of the House and a key player in the $1.5 trillion tax reform bill. Photo: Speaker Ryan

Indian Country left behind as Republicans push tax cuts through Congress

Democrats call $1.5 trillion tax reform bill a missed opportunity for tribes

'We're going to continue to fight'
By Kevin Abourezk

Passage of a $1.5 trillion tax reform bill represents a rare and now missed opportunity to address the many economic development disparities in Indian Country, according to Democratic members of Congress.

“Congress has a responsibility to ensure that tribes are able to be self-sustaining and have access to economic opportunities, and that’s why the tax bill that just passed the House is so deeply disappointing,” said Rep. Dan Kildee (D-Michigan) during a conference call following passage of H.R.1, the Tax Cuts and Jobs Act.

The House vote on Tuesday afternoon set the stage for final passage of the controversial legislation. The roll call fell along party lines, with all but 12 Republicans in support of the bill and all Democrats opposed.

Despite the partisan outcome, the measure is expected to clear the Senate either Tuesday evening or early Wednesday.

A last-minute snag in the Senate will then require the House to re-vote on a modified version of the bill sometime on Wednesday. But Republican still expect to get it to President Donald Trump so he can sign it into law and declare victory by Christmas.

"Congratulations to Paul Ryan, Kevin McCarthy, Kevin Brady, Steve Scalise, Cathy McMorris Rodgers and all great House Republicans who voted in favor of cutting your taxes!" Trump said in a post on Twitter, naming the Republican leaders who shepherded H.R.1 through the House with little input from Democrats.

Speaker Paul Ryan on YouTube: ‘This is a good day for America.’

The bill, which wasn't unveiled in its final form until last Thursday, would implement deep and permanent tax cuts for corporations and temporary cuts for individuals.

In a December 13 letter, 38 House members called for changes to the tax bill that would benefit tribes. The representatives said the current tax code fails to recognize tribal sovereignty and fails to treat tribes on the same level as states and local governments.

“The tax code does not recognize sovereignty of tribal governments and as a result tribes do not enjoy the same benefits as state and local governments do under the tax code,” Kildee said Tuesday. “Neither the House nor the Senate Republican tax bill addressed the tax disparity that tribal communities face.”

Specifically, those 38 members called for:

· Changes to the tax code that would allow tribal governments to use tax-exempt bonds for economic development projects, something that tax laws currently prohibit for tribes but allow for state and local governments.

· Approval of tax credits for families that adopt special needs children through tribal courts. Currently, only families that adopt such children through state courts are eligible for tax credits.

· Approval of various excise tax exemptions for tribal governments that state and local governments already enjoy.

Kildee said the tax bill conference committee – made up of Senate and House members who drafted the final package – failed to include any of the recommendations made last week. In fact, he said, it cut a provision from the previous House version of the bill that would have allowed individuals participating in an Indian Health Service loan repayment program to deduct their payments as income for the purpose of taxation.

“Instead of including tribes in the tax bill, the Republican leadership told tribes that yet again they must wait for some future moment to work on tax reform,” he said. “That’s completely unacceptable.”

Rep. Derek Kilmer (D-Washington) cited a 2003 report by the U.S. Commission on Civil Rights, “The Quiet Crisis,” that called for reform of tax codes that benefit state and local governments but not tribes. He said the report clearly established the need for reform of tax disparities that hurt tribal governments.

“Unfortunately today represents a missed opportunity, but we’re going to keep pushing for another bite at the apple because what’s happened today is the wrong direction,” he said.

Rep. Norma Torres (D-California) said lawmakers are failing to fulfill their trust responsibilities to tribes by not making changes to federal tax laws that unfairly benefit state and local governments but leave tribes behind.

“The bill that we just voted on represents a broken promise to the forgotten citizens of this nation, specifically the first people of this country,” said Torres, the top Democrat on the House Subcommittee on Indian, Insular and Alaska Native Affairs. “We have treaty and trust responsibilities to our nation’s tribes that have gone unmet for far too long.”

Kildee said he plans to continue proposing changes to federal tax law that would benefit tribes.

“We’re going to continue to fight,” he said.

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