Republican Camp Will Leave Congress as Tax Revamp Stalls

Photographer: Andrew Harrer/Bloomberg

U.S. Representative Dave Camp, a Republican from Michigan and chairman of the House Ways and Means Committee, arrives to a news conference in Washington, D.C., on Feb. 26, 2014. Close

U.S. Representative Dave Camp, a Republican from Michigan and chairman of the House... Read More

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Photographer: Andrew Harrer/Bloomberg

U.S. Representative Dave Camp, a Republican from Michigan and chairman of the House Ways and Means Committee, arrives to a news conference in Washington, D.C., on Feb. 26, 2014.

Republican Representative Dave Camp, who has pursued the most significant revision of the U.S. tax system since 1986, won’t seek re-election to Congress this year.

Camp, 60, yesterday announced plans to retire after this term, in advance of the candidate-filing deadline in his home state of Michigan. Republican term limits -- which he criticized last month -- prevent him from continuing as chairman of the House Ways and Means Committee in 2015.

Camp’s announcement makes it more likely that the draft tax plan he released in February will be a blueprint for future action rather than legislation with a real chance of becoming law anytime soon.

“Many of the fundamental reforms that they have perfected in their draft will certainly serve as a template for some part of tax reform, when it’s ultimately done,” said former Representative Jim McCrery, who preceded Camp as the top Republican on Ways and Means. “And that’s worth a lot.”

Camp was first elected to Congress in 1990, the same year as House Speaker John Boehner.

“From the beginning, I have been impressed by his wisdom and thoughtfulness, and grateful for his friendship,” Boehner, an Ohio Republican, said in a statement yesterday.

Among Camp’s accomplishments are the 1996 changes to the U.S. welfare system, and he frequently cites its passage after two vetoes by President Bill Clinton as a case study in legislative persistence during an election year.

Baucus Tour

Camp became Ways and Means chairman when Republicans gained the majority in the U.S. House of Representatives in the 2010 election. He began focusing immediately on tax-code changes, working with Max Baucus, then the Democratic chairman of the Senate Finance Committee.

They toured the country last year, trying to build support for a simpler tax system with lower rates and fewer breaks. Their efforts haven’t advanced much.

Congress is locked in a partisan dispute over whether the government should collect more money as it revises the tax code and lawmakers have shown little interest in endorsing limits on politically popular tax breaks.

Baucus, who had announced that he wouldn’t seek re-election, left Congress earlier this year to become the U.S. ambassador to China. That sapped momentum from the bipartisan effort.

Then, Camp released his draft tax plan Feb. 26 with no commitment of support from Republican leaders. Unlike other conceptual efforts, it was written in legislative language and accompanied by formal estimates from congressional scorekeepers.

Three Brackets

The plan would consolidate the seven individual tax brackets into three, lowering the top rate to 35 percent from 39.6 percent. Corporations would receive a 10 percentage point rate cut to 25 percent along with lighter taxes on income they earn outside the U.S.

To pay for his changes, Camp proposed eliminating or limiting a number of tax breaks, including the deduction for state and local taxes, the home mortgage interest deduction and business advertising write-offs. He also proposed a quarterly tax of 3.5 basis points on assets exceeding $500 billion for the largest U.S. banks and insurers.

Camp’s revision plan will become a baseline for future efforts, said Don Susswein, a principal at McGladrey LLP in Washington.

“People will say, I’m for Camp -- with the following modifications,” Susswein said.

Republican Rules

As recently as Jan. 8, Camp said he planned to run for re-election, while cautioning that he wasn’t making a formal announcement. Under party rules in the House, Republicans have six years atop a committee, whether they’re in the majority or not. Camp’s clock started ticking in January 2009, when Republicans were in the minority.

“It’s a shame that Dave Camp doesn’t have two more years to serve as chairman,” said McCrery, who represented Louisiana and is now a Washington-based tax lobbyist.

The past two Republican Ways and Means chairmen who reached the limit -- Bill Archer of Texas and Bill Thomas of California -- didn’t run for re-election to Congress.

“During the next nine months, I will redouble my efforts to grow our economy and expand opportunity for every American by fixing our broken tax code, permanently solving physician payments for seniors, strengthening the social safety net and finding new markets for U.S. goods and services,” Camp said in a statement released yesterday.

Chairman Contenders

The top Republican contenders for Ways and Means chairman in 2015 are Representative Paul Ryan of Wisconsin, the 2012 vice presidential nominee who currently heads the budget committee, and Representative Kevin Brady of Texas.

Camp steered a middle course among House Republicans, often backing party leaders as they grappled with divisions between veteran lawmakers and Tea Party-backed newcomers who favored smaller government.

Camp was one of 85 Republicans who voted for the January 2013 agreement that set tax rates for top earners at their current levels, higher than he and other Republicans wanted. He was one of 87 Republicans who voted in October 2013 to end the 16-day partial government shutdown.

Camp, who had considered running for U.S. Senate, joins several Michigan lawmakers in announcing that they won’t seek re-election this year. They include Democratic Representative John Dingell, the longest-serving member of Congress in U.S. history, Republican Representative Mike Rogers, chairman of the House Intelligence Committee, and Senator Carl Levin, a Democrat first elected in 1978.

‘Decent Man’

Levin, whose brother Sander is the top Democrat on the Ways and Means panel, said he was surprised by Camp’s decision.

“He’s a very decent man, and I think he’s shown some real courage,” Carl Levin said. “I can never say I’m disappointed, though, to see a Republican leave who might be followed up with a Democrat. I wouldn’t be honest with you if I said that.”

Camp is from Midland, Michigan, the home of Dow Chemical Co., and his district stretches across the rural central part of the state. He was re-elected in 2012 with 63.1 percent of the vote. Republican presidential candidate Mitt Romney won 53 percent of the vote there in 2012.

Camp was treated in 2012 for non-Hodgkin’s lymphoma and doctors declared him free of cancer later that year.

To contact the reporter on this story: Richard Rubin in Washington at rrubin12@bloomberg.net

To contact the editors responsible for this story: Jodi Schneider at jschneider50@bloomberg.net Michael Shepard

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