News : The downtown ‘book tax’ pile on continues

Thursday, August 4, 2022

The downtown ‘book tax’ pile on continues

Aug 04, 2022

With Daniel Lippman

FIRST IN PI — BUSINESS GROUPS KEEP UP PRESSURE ON BOOK TAX: The business community is continuing to flood the zone with pushback to the 15 percent corporate minimum tax in Democrats' reconciliation package. More than 100 business and trade groups sent a letter this afternoon to senators looking to illustrate the "broad impact of this measure" on the industry, the latest front in what has already been an aggressive weeklong lobbying blitz against the provision.

— Today's letter was spearheaded by the National Association of Manufacturers, and other signatories include Washington's biggest business lobbies, the U.S. Chamber of Commerce and Business Roundtable, as well as the American Petroleum Institute, Associated Equipment Distributors, National Stone, Sand & Gravel Association and dozens of other local and national trade associations.

— Half a dozen signatories hail from Arizona, whose senior Sen. Kyrsten Sinema remains among the bill's biggest wild card votes and has faced immense pressure from business interests and colleagues on the Hill alike. CNN reported this week that on a call with the heads of the Arizona Chamber of Commerce and NAM, Sinema was interested in hearing out their concerns with the book minimum tax in particular, while Bloomberg has reported Sinema is seeking to narrow the provision . (Arizona is also home to one of the Senate's most vulnerable Democratic incumbents, Mark Kelly , meaning that much of the deluge of lobbying over the bill has hit the Grand Canyon State.)

— "It is clear that a book tax would threaten American competitiveness," the groups wrote, pointing in particular to discrepancies in how tax and finance accounting rules treat capital investments, like machinery and equipment in the case of manufacturers.

— "Accelerated depreciation – the ability to recover the cost of acquiring an asset over a short time span, sometimes as soon as the year of purchase – has been in the tax code in some form since at least 1958," they wrote, adding that while that part of the tax code "encourages companies to invest in capital assets … the financial accounting rules upon which a book tax is based require depreciation over the useful life of an asset."

RESTAURANTS OUT ON RECONCILIATION TOO: National Restaurant Association came out against the package today as well, with the organization's top lobbyist Sean Kennedy calling the bill a "net negative for local restaurants" despite having "laudable goals." The group's chief complaint is the legislation's 15 percent corporate minimum tax, which while unlikely to impact restaurants directly, could end up trickling down to the industry, it said.

— The trade group pointed to data showing how the so-called book tax would hit manufacturers hard, which could include those in the restaurant supply chain like producers of meat, seafood, soft drinks, and alcohol — and who could end up passing increased costs down to restaurant owners, who are facing increased costs already due to inflation, on top of already having been hit hard during the pandemic.

Good afternoon and welcome to PI. Send K Street tips and musings: coprysko@politico.com . And be sure to follow me on Twitter: @caitlinoprysko .

INTRODUCING POWER SWITCH: The energy landscape is profoundly transforming. Power Switch is a daily newsletter that unlocks the most important stories driving the energy sector and the political forces shaping critical decisions about your energy future, from production to storage, distribution to consumption. Don't miss out on Power Switch, your guide to the politics of energy transformation in America and around the world. SUBSCRIBE TODAY .

HOW K STREET SEES THE NEXT FEW MONTHS SHAKING OUT: "It has been an eventful few weeks in the political world," Hogan Lovells lobbyists wrote in a memo to clients on Wednesday that lays out their thinking on what August and September will look like for Washington. (PI fact check: true.)

— The firm, whose clients include Binance.US, Nissan, the tech-backed Computer & Communications Industry Association, T-Mobile, Walmart, Airbus and more, predicts that "for the next week (or two), all eyes in Washington will be on Senate Democrats" and Sinema in particular, with a final vote to pass the reconciliation bill coming this weekend or next week before heading home for the August recess.

— Things will pick back up in September with work to avert a government shutdown likely resulting in a continuing resolution that will punt the issue until after the midterms, Senate passage of the NDAA and potentially a Senate vote on the pair of antitrust bills Senate Majority Leader Chuck Schumer has been pushing off a vote on for months (Schumer's office told POLITICO this afternoon that he plans to bring at least one of the bills up for a vote ).

— "We are skeptical the legislation has the 60 votes it needs to pass," the firm said, "but Senator [ Amy] Klobuchar continues to charge hard and Senator Schumer could allow for a short procedural vote on her bill."

— Further crowding the calendar will be a slate of judicial and executive branch nominees as Senate Democrats look to fill as many vacancies as possible with future control of the chamber up in the air come November.

KNOWING SBF: "One of the biggest donors in Democratic politics this year isn't sure if he really wants to be a Democratic megadonor — at least not on the party's terms," POLITICO's Elena Schneider writes in a profile of FTX boss Sam Bankman-Fried reported from the Bahamas.

— "The 30-year-old, who has amassed an estimated $20 billion fortune over the last four years through cryptocurrency, drives a hybrid Toyota Corolla. A monk-like aesthetic extends from his clothes — he showed up to chat in a wrinkled T-shirt and beat-up New Balance sneakers — to his personal life. He shares a penthouse with about 10 roommates and cooks for himself. He still uses his parents' Netflix account. When he lobbies in Washington, D.C., he'll often crash on his brother's couch."

— "The head-spinning speed of Bankman-Fried's entrance onto the national political scene kicked off a race in Washington to understand him and define him — as a potential Democratic savior, a head-scratching mystery or, occasionally, a corrupt crypto bogeyman."

— "Candidates, consultants and members of Congress are all eager to direct the millions he's spending. And Bankman-Fried seemingly wandered into the middle of the Democratic Party and pulled out his wallet at the exact moment when many Democratic megadonors are pulling back, all ahead of a blistering midterm environment."

IT'S NOT ALL SEIZING YACHTS: "In the five months since the U.S. Department of Justice launched a task force to seize Russian oligarchs' assets to pressure Moscow over its invasion of Ukraine, prosecutors also have targeted something less tangible ," Reuters' Luc Cohen reports: Russia's influence.

— "Prosecutors in that period have charged five Russians with acting on the Kremlin's behalf without registering as foreign agents, as the Justice Department broadly ramps up enforcement of the Foreign Agents Registration Act (FARA) and a related law known by its code number, 951. FARA and 951 let prosecutors go after broader activity - such as lobbying or running media campaigns - than espionage statutes, which focus on agents seeking classified or military information, experts said."

— "Since 2018, the United States has accused 52 people - including Russian, Chinese and American citizens - of violating or conspiring to violate FARA, 951 or both, according to a Reuters analysis of Justice Department statements and records from seven major district courts. In the prior six-year period, just 13 people were charged under those laws, the analysis shows."

ICYMI WEDNESDAY — MICROSOFT FLEW OUT HILL STAFFERS: "As Big Tech was lobbying to keep the Senate from passing antitrust legislation, Microsoft flew dozens of congressional staffers out to Washington for a multi-day visit with its lobbyists and executives," Sludge's Donald Shaw reports.

— "During the event, held June 29 through July 1, the staffers met Microsoft's senior director of government affairs, Alli Halataei, according to gift travel disclosures filed with the Senate and House. Halataei is one of the lobbyists the company reports as having held discussions with members of the House and Senate on antitrust issues, according to its lobbying disclosure for the second quarter of this year."

— "In particular, the disclosure indicates that Halataei lobbied on the Open App Markets Act and the American Choice and Innovation Online Act (ACIOA), the two antitrust bills that passed out of the Senate Judiciary Committee earlier this year but are being held back from floor votes by Senate Majority Leader Chuck Schumer (D-N.Y.) for unknown reasons."

— Shaw notes that the staffers' trips closely preceded a visit from Schumer himself, where the majority leader reportedly met with Microsoft President Brad Smith to discuss the bills, one of which Microsoft supports , according to FedScoop.

FDA'S REVOLVING DOOR: "The departure of the head of the Food and Drug Administration's tobacco science office for a job in the tobacco industry shines a new spotlight on a long-running problem : the 'revolving door' between government regulators and the industries they police," reports Grid's Dan Vergano.

— "Matt Holman , whose work at the FDA influenced decisions around the safety of products such as e-cigarettes, left the agency Tuesday for a job with Philip Morris International, whose products — sold overseas — include Marlboro cigarettes and the electronic tobacco-delivery system IQOS."

— The outlet analyzed data from LinkedIn profiles, which found at least 2,700 former FDA employees "now work for the pharmaceutical industry. Another 1,100 current FDA employees have moved the other way, from industry to the agency, according to the profile information."

STEP INSIDE THE WEST WING: What's really happening in West Wing offices? Find out who's up, who's down, and who really has the president's ear in our West Wing Playbook newsletter, the insider's guide to the Biden White House and Cabinet. For buzzy nuggets and details that you won't find anywhere else, subscribe today .

Jobs Report

— Tiffany Haas will be head of government affairs at the Financial Services Forum. She has served as the forum's co-head of government affairs since September 2018 and is a Consumer Bankers Association and Rep. Donald Payne (D-N.J.) alum.

— Derek Lyons has been named president and CEO of Restoring Integrity and Trust in Elections. He previously was counselor to the president and White House staff secretary in the Trump administration.

— McKenzie Wilson is now manager for ESG and sustainability services at Deloitte. She most recently was chief of staff at disaster response and humanitarian organization Global Support and Development.

— Mayealie Adams is now vice president and head of government affairs at Danaher. She most recently was managing director for government and external affairs at Phillips.

— Richard Clarida, the former Fed vice chair who stepped down in January amid a trading scandal, is returning to PIMCO , the investment management firm where he spent 12 years before joining the Fed, as a managing director and global economic adviser.

— Nate Anderson is joining the Stand Together Foundation as executive vice president for operations. He previously was executive director of Concerned Veterans for America. Russ Duerstine will move up to lead CVA, where he previously was acting director and deputy director.

— Zachery Henry is now communications director for Blake Masters' Arizona Senate campaign. He previously was digital director at Raconteur Media Company and is an Arizona Republican Party and Kelli Ward alum.

— David Spirk is now senior counselor at Palantir. He previously was the first chief data officer at DOD.

— John Desser is now senior vice president for government affairs at HealthEquity. He most recently was senior vice president for government affairs at eHealth.

— Steve Glickman is now president of Aspiration Global. He previously was co-founder of the Economic Innovation Group and is an Obama White House and Commerce Department alum.

New Joint Fundraisers

AZ NH NV OH Victory Fund (Sens. Mark Kelly, Maggie Hassan, Catherine Cortez Masto, Rep. Tim Ryan)
Cao Victory Fund (Cao for Congress, Republican Party of Virginia Inc, NRCC)
Chris Deluzio Victory Fund (Chris Deluzio for Congress, Pennsylvania Democratic Party)
DSCC PA WI Victory 2022 (DSCC, Mandela Barnes for Wisconsin, Fetterman for PA)
Eric Sorensen Victory Fund (Eric Sorensen for Illinois, Democratic Party of Illinois)
Healey Victory Fund (Bob Healey for Congress, New Jersey Republican State Committee, NRCC)
Mandela Barnes Victory Fund (Mandela Barnes for Wisconsin, Leading the PAC, Democratic Party of Wisconsin Federal)
NRCC Oregon Victory (Alek for Oregon, Lori Chavez-DeRemer for Congress, Mike Erickson for Congress, NRCC)

New PACs

American Health Advocacy PAC (Super PAC)
Americans United For Change (PAC)
Bright Future RI (Super PAC)
The Common Sense Project (Super PAC)
Frontline for Freedom Hybrid Political Action Committee (Hybrid PAC)
NYIC Action Federal PAC (PAC)

New Lobbying Registrations

Broydrick & Associates: Palindromes Inc.
Cfm Strategic Communications (Conkling Fiskum & Mccormick): City Of Stayton
Horizons Global Solutions LLC: Captura Biopharma
Jenner & Block LLP: Yurok Tribe
Mike Williams Capitol Strategies LLC (F/K/A Mw Capitol Strategies LLC): Steptoe & Johnson LLP On Behalf Of Dewberry Engineers
Penn Hill Group: Committee For Children
The Williams Group: H&R Block
The Williams Group: Id.Me

New Lobbying Terminations

Jenner & Block LLP: Sorenson Communications, Inc.