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House Dem Brings Tax Chops to Committee Without Throwing ‘Bombs’

July 19, 2019, 8:45 AM

Judy Chu, a member of the tax-writing House Ways and Means Committee, is known for forging connections with other lawmakers in a divisive time.

Chu, the first Chinese American woman elected to Congress, in 2009, scored a major tax policy win recently when Ways and Means unanimously approved a bill (H.R. 3299) she sponsored that would extend tax refund eligibility for same-sex couples who were married before the federal Defense of Marriage Act was overturned by the U.S. Supreme Court.

That measure is now tied into a broader tax package that is one of the committee’s top priorities in the coming weeks.

Republicans on Ways and Means like the serious policy chops the California Democrat brings to her job. She tends not to be a “bomb thrower,” which Republicans respect, said Rep. Tom Reed (R-N.Y.).

“It’s good to have that kind of person on the committee, in particular where, you know, you have a passionate disagreement philosophically, but the way you handle it sets the tone,” Reed said.

Chu is a member of the House Progressive Caucus, which includes such firebrands as Reps. Alexandria Ocasio-Cortez (D-N.Y.) and Ayanna Pressley (D-Mass.). She calls herself a coalition-builder who can work with the increasingly diverse House Democratic Caucus and with Republicans—and she is seen that way.

“To get legislation through Congress and to get stuff done in Washington is never easy, and so having someone who’s interested in learning what the challenge is and then working together to figure out what the solution is, being able to do that openly and honestly and with a full degree of trust is something we’ve always found with Congresswoman Chu,” said David Stacy, government affairs director with the Human Rights Campaign. The campaign gave input on provisions of H.R. 3299, he said.

Tax Chops

Chu joined Ways and Means in 2017, bringing state-level tax policy experience with her. Committee Chairman Richard Neal (D-Mass.) at the time touted her service on the California State Board of Equalization, which collects certain state taxes.

“What I want to do is make our tax system as fair as possible,” she said in an interview with Bloomberg Tax. “I want to make it a tax system that will give greater opportunity to middle-class people.”

Chu has terrific ideas, one reason she gets bipartisan support, said Rep. Ted Lieu, a fellow Democrat from California. She is also chair of the Congressional Asian Pacific American Caucus, and under her leadership, the group is the largest it has ever been, Lieu said.

“She is focused on her district, minority candidates. It’s very important to have a government that looks like the people we serve,” he said.

SALT Stance

Chu has hopes of changing the 2017 tax law that aren’t as hard-line as some of her peers.

Like many Democrats in high-tax states, Chu thinks the $10,000 cap on state and local tax deductions is unfair. But she isn’t calling for an outright repeal of the limit like Reps. Tom Suozzi (D-N.Y.) and Bill Pascrell (D-N.J.), both Ways and Means members.

“The good thing about what Bill Pascrell is saying is, ‘We need to do something about it.’ That’s what I appreciate about what he says,” Chu, a member of the committee’s SALT working group, said.

Democrats have struggled with how to address the cap because scrapping it entirely is seen as a handout to the rich. More than half of tax breaks would would go to those who make $1 million or more if the limit is repealed, according to Joint Committee on Taxation data. A possible solution is to raise the limit and have it indexed to inflation, she said.

“If you look at the fine details, if you raise the cap a certain amount, it really does help the middle class. It’s not the millionaires that Republicans are always talking about,” Chu said.

Raising Her Voice

Chu has repeatedly called for the release of President Donald Trump’s tax returns. The Treasury Department has rejected requests and a subpoena from House Democrats, leading to them to file suit in their quest.

“I would actually like to have them before the end of the year,” she said. “I think that’s doable. That’s what I hear from the experts. I don’t even want to go to that place where I think about beyond next year.”

It’s beyond the tax policy realm, perhaps, where Chu is most known for taking tough stances.

She was among a cohort of House Democrats who visited federal migrant detention centers in El Paso, Texas, and Clint, Texas, earlier this month amid the broader immigration backlash. She decried the conditions they saw there as “appalling and disgusting.”

And after her nephew, a Marine Lance corporal, died by suicide following alleged hazing in 2011, Chu called for a congressional hearing on military hazing, as well as an independent review of the issue.

Chu’s political life began on a local school board, and she has fulfilled a lot of political aspirations since then, said California State Controller Betty T. Yee, who served with Chu on the California Board of Equalization.

“I could see her continuing to ascend into leadership positions within Congress. At some point there will be, you know, maybe an opportunity where a U.S. Senate seat may open,” Yee said.

To contact the reporters on this story: Kelly Zegers in Washington at kzegers@bloombergtax.com; Kaustuv Basu in Washington at kbasu@bloombergtax.com

To contact the editors responsible for this story: Jeff Harrington at jharrington@bloombergtax.com; Colleen Murphy at cmurphy@bloombergtax.com

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