Repeal of Johnson Amendment Struck From GOP Tax Bill

Repeal of Johnson Amendment Struck From GOP Tax Bill

The final version of the Republican tax bill will not include a repeal of the Johnson Amendment, the Wall Street Journal reports.

The repeal of the 1954 tax code provision would have allowed religious organizations and all nonprofit groups with 501(c)(3) tax-exempt status to endorse or raise funds for political candidates. On Thursday night, Sen. Ron Wyden's (D-OR.) office confirmed to The Hill and the Washington Post that the Senate parliamentarian had determined that inclusion of the provision's repeal in the bill did not meet the Senate's rules for reconciliation, which require that all provisions of a tax bill have something to do with the budget.

The House bill that passed in November would have allowed nonprofits to engage in political speech in the ordinary course of their activities, so long as organizations did not incur significant expenses while doing so; the Senate bill did not include repeal of the amendment. The parliamentarian's decision is considered a minor victory for Democrats, who cannot filibuster the bill under reconciliation and have little leverage in the process, as both the House and Senate versions of the legislation were passed on straight party-line votes.

"I'm disappointed in the decision of the parliamentarian to not allow the revised text of the Johnson Amendment into the tax reform bill," said Sen. James Lankford (R-OK). "The federal government and the IRS should never have the ability, through our tax code, to limit free speech." The repeal language that Republicans crafted would have prohibited any campaign financing via nonprofits, Lankford argued.

Earlier this year, President Donald Trump signed an executive order that directed the Internal Revenue Service to relax enforcement of rules barring tax-exempt churches from political activity. During a National Prayer Breakfast event, Trump vowed to "totally destroy the Johnson Amendment and allow our representatives of faith to speak freely and without fear."

More than four thousand religious leaders had opposed a possible repeal of the provision, arguing in a joint letter that "[c]hanging the law would threaten the integrity and independence of houses of worship." Others were concerned that repeal of the provision would create a new “dark-money” channel through which wealthy donors would be able to quietly funnel funds to political candidates.

"I will continue to fight all attempts to eliminate this critical provision that keeps the sanctity of our religious institutions intact, prevents the flow of dark money in politics, and keeps taxpayer dollars from advancing special interest biddings," Wyden said in a statement.