Insurance industry officials say they are “making significant progress” in explaining to members of Congress the inappropriateness of changing laws relating to deferred compensation packages as contained in the Senate version of minimum wage legislation.
At the same time, the industry officials caution that even if the deferred compensation provision contained in the Senate version of the bill does not make it into law, “it is likely to come up again as legislators seek to find ‘revenue raisers’ for tax policy priorities in subsequent tax bills in this Congress,” according to David Stertzer, CEO of the Association for Advanced Life Underwriting.
The Senate passed a bill in early February containing the deferred compensation provision, but companion legislation that passed in the House Feb. 16 did not include the provision.
Stertzer said that congressional staffers and legislators have already begun preparing for a conference to reconcile the differing bills, and “the size of the tax package is currently the central issue in this debate.”
Stertzer noted that Democrats have established a policy stipulating any programs added by Congress that cost money must be paid for either through higher taxes, which is unlikely, or through cuts in existing programs. The policy is known as “pay-go” in congressional shorthand.
“In light of the pay-go environment, even if the deferred compensation provision is dropped from this legislation, it is likely to come up again as legislators seek to find “revenue raisers” for tax policy priorities,” Stertzer said.
He added that the industry “will continue its efforts on Capitol Hill to educate legislators and their staffs about the harmful nature and broad impact of the deferred compensation proposal.”