Tax Breaks for Lobbying

IN developing a budget package that will clear both sides of the Capitol, House and Senate conferees are doing a modest good turn for the American political process: They are eliminating tax breaks for lobbying.

To be sure, the effort - especially by itself - is unlikely to have a dramatic long-term effect on lobbying. Companies and industries will still see a need to represent their interests in Washington. But it does signal Congress's unwillingness to continue providing what in effect is a public subsidy to "Gucci Gulch."

The House version of the measure covers efforts to lobby Congress or the White House to influence legislation. The estimated income to the government over five years is $850 million. The Senate version also includes lobbying before regulatory agencies and would bring in a little over $1 billion during the same period.

The provisions would affect more than 9,000 trade associations and other firms who exist mainly as lobbies.

Those who oppose the provisions argue that they are unconstitutional because they infringe on clients' or members' rights to petition the government. Yet eliminating a tax break doesn't prevent an executive from doing what ordinary citizens do: write a letter. Especially in this age of electronic mail, the opportunities for contacting all key lawmakers involved in any issue are ample and the options more speedy than first-class mail.

Other objections include questions of fairness: Lobbying is undertaken by a range of tax-exempt groups and law firms, who might not be as heavily affected by the elimination of the tax break. The activities of law firms may require closer scrutiny, because distinguishing lobbying expenses from legitimate legal expenses may be difficult. Yet the provisions conferees are reconciling do deal with law firms' lobbying activities. And by some accounts, tax-exempt groups may be required to report the amount of membership dues that goes to nondeductible lobbying activities to the Internal Revenue Service.

Undoubtedly, the cost of lobbying will be passed on to consumers. But at least, purchasing a product reflects a choice; a public subsidy for special-interest attempts to influence public policy does not.

The notion of eliminating tax breaks for lobbying activities first surfaced in the context of campaign finance reform. But regardless of the final wrapping, the provision is worth adopting.