(Corrects 8th paragraph to make clear 6,500 is maximum number
of tax lobbyists in 2011-2012; deletes paragraph 9 on lobbyists
By Nanette Byrnes
May 15 The ranks of lobbyists are growing in
Washington again as Congress flirts with a possible overhaul of
the complex U.S. tax code.
After declining for two years, the number of companies that
hired a tax lobbyist, or lobbied on tax issues using in-house
staff, rose modestly to 1,509 in the first three months of 2013,
up from 1,487 during the same quarter a year ago, according to
government filings analyzed by the nonpartisan watchdog group
the Center for Responsive Politics.
Coinciding with the start of a new session of Congress, the
analysis shows it is the busiest first quarter for tax lobbying
since 2010, when President Barack Obama set up the bipartisan
Simpson-Bowles commission to find a solution to the country's
growing deficit, including changes to the tax code.
This year's climb in the tax lobbyist population comes at a
time when revamping the tax code is on the minds of some
decision-makers, though comprehensive legislation has yet to
Obama says he wants a tax code overhaul. So do the chairmen
of Congress's two tax-writing committees - Democratic Senator
Max Baucus of Montana and Republican Representative Dave Camp of
Michigan who together created TaxReform.gov, a website that asks
Americans to share their stories and ideas about tax reform.
Opinion polls show the public wants a simpler tax code, but
political obstacles stand in the way. The last overhaul was in
1986. A lack of political consensus in Congress on whether tax
reform should raise new federal revenues is a problem. So is
division within the business community about changing the code.
The expanding ranks of tax lobbyists are both a result of
the push for change and likely to prove one of its greatest
impediments, with each lobbyist paid substantial sums of money
to defend and, if possible, expand the narrow interests of their
More than 2,220 organizations spent an estimated $773
million hiring as many as 6,500 lobbyists to advocate on 1,454
tax-related bills in the 2011-2012 Congress, said the non-profit
Sunlight Foundation, another government influence watchdog
Peter Metzger, Washington-based vice chairman of executive
head-hunting firm CTPartners, estimates based on what his firm
is seeing in the marketplace that demand for tax lobbyists and
tax lawyers in Washington is up 25 to 30 percent this year.
Metzger's office specializes in recruiting government relations
staff and lobbyists, among other fields.
The title of a recent client advisory from lobbying law firm
K&L Gates was: "If you are not at the table, you're on the
TECH GIANTS EXPAND IN D.C.
In the first three months of 2013, online retail giant
Amazon.com Inc spent $1.2 million on in-house and
external lobbyists who lobbied on tax, and usually other topics
too, according to federal filings. That is up from $870,000 in
the prior year's first quarter.
Lobbying firms generally represent their clients on multiple
issues, and exactly how much of their fees relate to lobbying on
taxes is not disclosed.
Amazon backed a measure that passed the U.S. Senate this
month to give states the power to enforce their sales tax laws
on online purchases.
Amazon employs a couple of firms which lobbied exclusively
on Internet sales tax legislation, in the first quarter of this
Amazon paid such firms $250,000, according to lobbying
reports filed in April by two firms, Patton Boggs and
Forbes-Tate, with the House of Representatives and Senate. Of
that, $220,000 went to lobbyists from Patton Boggs, including
former senators John Breaux and Trent Lott, according to their
April 20 lobbying report.
In addition, lobbying firm TwinLogic Strategies disclosed in
its April 21 Amazon lobbying report that Elizabeth Frazee, a
former top aide to House Judiciary Committee Chairman Bob
Goodlatte, was also lobbying on the Internet sales tax
legislation. The Virginia Republican's committee will be the
first to consider online legislation in the House, where the
legislation faces a tougher fight.
Amazon declined comment on its lobbying efforts.
Software maker Microsoft Corp has more lobbyists
working on tax issues so far this year than any other company,
according to an analysis of filings done by the Center for
All together, in the first quarter of 2013, Microsoft spent
over $3 million on lobbyists who reported spending at least some
of their time working on taxes, up from $2.2 million in the
comparable period of 2012.
Microsoft, which now has $66 billion in cash sitting
overseas according to its most recent quarterly filing with the
Securities and Exchange Commission, was part of a coalition of
companies pushing for legislation that would enable them to
bring earnings home to the United States without paying the full
tax on them.
It is a controversial proposal because the last such tax
break, in 2004, failed to produce the domestic jobs and
investment Congress had hoped for.
The company's in-house lobbying staff and eight of its
outside lobbying firms list international tax reform proposals
as a topic they have contacted lawmakers about in lobbying
reports filed with Congress.
One of those outside firms, Ernst & Young, listed a bill by
Senator Bernie Sanders, a Vermont Independent, that seeks to end
the company's current ability to defer taxes on income earned
abroad, as one of the bills it has been discussing on Capitol
Microsoft has reported that it would owe $19.4 billion in
federal income tax if it were to bring its overseas cash to the
United States at current tax rates.
The company did not respond to a request for comment on its
(Reporting by Nanette Byrnes in Chapel Hill, North Carolina;
Editing by Howard Goller and Lisa Shumaker)