Tuesday, December 19, 2017

WATCH: Arizona Rep. Schweikert Argues GOP Tax Bill Will Help Dems' Fight Vs. Increasing Income Inequality; Does Reduce His Real Estate-Related Income Taxes

Arizona Rep. David Schweikert (R-CD6) voted with the rest of Arizona's GOP delegation (and all but 12 of his GOP colleagues) in passing the tax reform bill this afternoon, 227-203. Earlier, during debate, he took a novel tack and advised his Democratic colleagues that the tax cuts will help "the left" in its fight against increasing income inequality. Meanwhile, his office declined to respond to reports that one added provision that increases his after-tax income.

The International Business Times reported last week on the provision that had just been inserted that would benefit Congresspersons - and, others - with interests in real estate-related LLCs. (Some of the pass-through income will become deductible.) Schweikert was included in the article because he is on the House Ways & Means Committee, because he was on the conference committee for this bill, and because he is one of the five Republican leaders with at least $1M in such real estate investmennts.

(The provision became popularized by opponents as the #CorkerKickback, because Sen. Bob Corker is a potential beneficiary and became a supporter of the bill after it was inserted.)

Schweikert's personal financial disclosure filings indicate that he has owned Sheridan Equities LLC and Sheridan Equities Holdings LLC as long as he has been in the House, and that they are worth between $1M to $5M.  (He formed the 1st LLC while he was Maricopa County Treasurer, in 2006, and is the sole member of both.)

His income from the real estate LLCs has been between $980,000 and $1,375,000 for the years 2010-16. The annual income has fluctuated several times (up and down) during that period; coupled with Schweikert being the only member and that he has taken some capital gains, it would appear that he likely has some ability to manipulate how much money he receives from the businesses in a given year.

In researching this article, Arizona's Politics also discovered that Rep. Schweikert amended his personal financial disclosure statement one week before the initial bill was introduced to uncheck the amount of income (range) he received and to add that a portion of the income was capital gains and a portion from rents. (The initial and amended filings are below.)

Because of these factors, it is impossible to calculate how much tax savings the Congressman may realize as a result of the new provision.

The Congressman's office declined to respond to repeated requests for a reaction to the IBT article and an explanation as to the amended financial disclosure statement. If Arizona's Politics receives a response, we will update this article as needed.

Today, Schweikert was the only Arizona Representative to speak on the House Floor during debate of the new bill. In his trademarked impassioned delivery, he decided to "give everyone a slightly different view." He noted that a Wall Street Journal editorial simplified the differences between the two political parties into focusing on economic expansion ("the right") and income inequality ("the left").

Schweikert made the argument that the new bill is necessary because it will get the country out of a relatively-flat economic growth rate of 1.8%, and that income inequality will decrease when the economy grows. Even if it is widely believed that the bill sent to the Senate today will benefit wealthier people more than those at the bottom of the income scale.

(Below is the transcript from his comments. The C-Span website is not operating normally this afternoon, and the video will be added later.)

David Schweikert

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