Daily Tax Update - September 17, 2013: Treasury Secretary Discusses Debt Ceiling and Tax Reform

Treasury Secretary Discusses Debt Ceiling and Tax Reform:  In remarks today at the Economic Club, Treasury Secretary Jacob Lew urged Congress to raise the debt ceiling.  Lew said that it is “important that Congress move as soon as possible to raise the debt ceiling and eliminate any uncertainty about America’s ability to pay its bills.  Lew stated, “As many of you know, we will soon be unable to finance the government if Congress fails to raise the debt ceiling.  Raising the debt limit is Congress’s responsibility because Congress, and Congress alone, is empowered to set the maximum amount the government can borrow to meet its financial obligations.”  Lew added, “Failure to raise the debt limit – or even an extended debate on the merits of doing so like we experienced in 2011 – is a self-inflicted wound that can do harm to our economy right at a moment when the recovery is strengthening.”

On the issue of tax reform, Lew said, “The president tried just a few weeks ago to breathe a little life into the tax reform debate by suggesting that we think about business tax reform first. . . .  Look, the challenge in doing comprehensive reform is it's tied up in the whole fiscal policy debate.  We do not believe you can do all of tax reform -- individual and business tax reform -- unless you have an agreement on what your revenue is as part of a broader fiscal frame."  Lew added, “We're happy to do comprehensive tax reform with a revenue target that's part of a fiscal frame.  We're happy to work on business tax reform that uses the one-time savings to help build a foundation for economic growth in this country.  That leaves you paths that are still, I think, possible to cross."  Lew added, “It's very hard to get that rate even to 28 percent.  There's a debate between folks as to whether you can get to 25.  I have yet to see the ways to pay to get to 25.  But we have a structure to get to 28."

The remarks can be accessed here.