New Developments - Trump Administration

Public Finance Alert | December.15.2016

Below is some information and analysis we have gathered about the incoming administration and how it could possibly affect the Public Finance practice. We will continue to update this page as information becomes available so please check back.

  • Unified control of the House and Senate by one party provides the critical mass to make tax reform more likely.

    • However, successfully passing comprehensive tax reform legislation is time consuming and difficult, so any tax reform effort is unlikely to move forward in the first half of 2017.

  • Although there has been discussion about a large infrastructure bill ($1 trillion) in the first 100 days of the new Administration, a large scale infrastructure bill is unlikely to move forward in the first half of 2017.

    • A bill this scale raises of host of policy and fiscal questions, including eligible projects, revenue off-sets and funding/financing vehicles.

  • It’s likely that any initial tax bill in 2017 will include tax rate reductions.

    • To offset revenue lost from lowering tax rates, some deductions, exemptions and exclusions in the tax code will be examined as “pay-fors”.  This is particularly true with some of the largest of these provisions (deduction for charitable deductions, exclusion for employer provided health care, the home mortgage interest deduction) which have been singled out for special treatment in tax reform. These factors could also increase the pressure to tax municipal bond interest.