Documents from Treasury containing congressional communications regarding the 2017 effort to overhaul the federal tax code.
Pages 3–10: An email dated March 2, 2017, from Counselor to the Secretary of the Treasury Daniel Kowalski to Austin Smythe, policy director for then-Speaker of the House Paul Ryan. Kowalski wrote: “I was tasked yesterday with starting a conversation about the taxation of pass-through entities. Who would you recommend I reach out to, and can you provide me with contact information?”
Pass-through entities, also known as flow-through entities, reduce taxation on businesses by unloading taxable income onto owners or investors, allowing them to apply the income tax rate for individuals to a business’s profits.
On March 6, 2017, Kowalski emailed Mark Prater and worked to arrange a “Pass-through working group.” Kowalski wrote: “Through Austin Symthe, I got in touch with [Tax Counsel to Paul Ryan] George Callas over the weekend about scheduling a meeting for Wednesday on pass-throughs. He is available after 3 pm, and will loop in Barbara Angus.”
Both Prater, tax counsel for the Senate Finance Committee, and Angus, chief tax counsel for the House Ways and Means Committee, were key players in the crafting of the December 2017 tax law. Prater joined PricewaterhouseCooper’s Washington National Tax Services firm in June 2018, and Angus joined the Ernst and Young firm in February 2019.
From March 6 through 7, Kowalski, Prater, Angus, Callas, and Chief Adviser to Sen. Mitch McConnell Brendan Dunn discussed meeting times that would not interfere with any work related to repealing Obamacare.
A meeting titled “House/Senate/Treasury Meeting” was planned for March 10, 2017. The event description reads: “We will be meeting to discuss options for providing appropriate preferential tax treatment for pass-through income.”
Pages 21–23: On May 8, 2017, Kowalski emailed Caleb Orr, a staffer for Sen. Marco Rubio, regarding “the childcare issue.” The two arranged a phone call.
After their call, Orr emailed Kowalski about Ivanka Trump’s 2016 op-ed in the Wall Street Journal on the Trump campaign’s child-care plan. Orr wrote: “My boss [Rubio] 100% agrees with this assessment and we want to make sure that if tax reform gets done, we can help you fulfill that promise.”
Page 24: The Treasury’s deputy assistant secretary for tax and budget, Brad Bailey, emailed Veronica Wong and Tyler Grimm, both staffers for then-Rep. Darrell Issa on May 26, 2017. (Issa has since been nominated by President Trump as director of the U.S. Trade and Development Agency, but has not yet assumed office). Kowalski is copied on the email, in which Bailey wrote: “Your boss raised an pass-through taxation idea at a tax reform listening session earlier this week with Secretary Mnuchin. We wanted to follow up to see if we could learn more about it.”
Pages 25–26: Will Davis, tax policy counsel and staffer for Rep. Tom Reed, emailed Bailey on June 9, 2017: “I just wanted to follow up and see if you have some time in the near future to meet to catch up and discuss some of my boss’s priorities and projects for tax reform, which includes energy, university reform, and financial products.”
Bailey and Davis then scheduled a lunch meeting for the following Friday.
Page 27: On July 14, 2017, Orr emailed Kowalski a collection of news clips with the subject line “Child Tax Credit updates.” Orr wrote: “I wanted to make sure you had seen some recent articles about the Child Tax Credit and how it can best fulfill President Trump’s promises on child care.”
Kowalski replied: “Thank you. […] I’ve seen a couple of these articles and will look at the others. As you might suspect, no decisions have been made yet on what we do on this issue.”
Page 29:On July 17, 2017, Bailey received an email from Bill Hulse, a legislative assistant for Rep. Randy Hultgren, requesting a meeting with Secretary Mnuchin on behalf of Hultgren and Rep. Dutch Ruppersberger — both then members of the Municipal Finance Caucus. Hulse wrote, “Specifically, Members of the Municipal Finance Caucus would appreciate the opportunity to discuss the tax-exempt status of municipal bonds in advance of the Administration releasing a more detailed policy proposal regarding comprehensive tax reform.”
Pages 30–31: On Aug. 8, 2017, Thomas West at Treasury replied to an email chain with Prater and Angus, titled “first joint meeting.” West asked for confirmation that pass-through entities were previously flagged as “topic one” by Angus.
Page 32: In an email exchange dated September 27, 2017, Randy Herndon — tax counsel for Sen. Pat Toomey — sent a thank you to Drew Maloney at Treasury. Herndon wrote: “I failed to let you know how appreciative my boss is of your team and your boss’s efforts in helping get to consensus w/ Senate GOP Budget members on the $1.5T number.”
Maloney responded: “Thank you, it was a pivotal meeting.”
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