The Koch-funded Americans for Prosperity will launch its new tax reform efforts on Aug. 2 at the Newseum. | Phelan M. Ebenhack/AP Koch network prepares pivot to tax reform

A political group backed by Charles and David Koch will soon kick off a multi-million dollar campaign in support of overhauling the tax code that is poised to become the Koch network’s closest collaboration with the White House.

The Koch-funded Americans for Prosperity will launch its new tax reform efforts on Aug. 2 at the Newseum, according to an invitation reviewed by POLITICO. The event will feature House Freedom Caucus Chairman Mark Meadows, an ally of the Koch network who has been vocal on tax reform. AFP will offer buses to Washington to supporters from surrounding states to attend, and the group plans to host at least three dozen more events in the coming weeks in areas where it has an active presence.


Though the Koch network was often at odds with President Donald Trump during the 2016 election, AFP sees areas for agreement with the White House on tax reform. The group has been in frequent contact with Treasury Secretary Steven Mnuchin — whose chief of staff Eli Miller is a former AFP employee — and it praised Trump’s initial tax plan earlier this year.

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“We’re hoping to help them pass what we think is this real transformational reform,” AFP COO Sean Lansing said in an interview. “As long as they stick to the plan they outlined earlier this year and remain committed to not including a BAT, we’re going to be very supportive of that plan.”

Keeping the border adjustment tax — a system that taxes imports — that was floated by House Republican leadership earlier this year out of a tax package has become a top priority for the Koch network, which argues the tax would raise prices for consumers. The Koch network has laid out other priorities for tax reform, including lowering the corporate tax rate and creating fewer income tax brackets.

“Congress hasn’t had an opportunity like this in decades, and we’re urging members to unify around our vision for bold tax reform,” said AFP President Tim Phillips.

The Koch network has not always been satisfied with Republican attempts to overhaul Obamacare. The group opposed a March bill backed by Trump and Capitol Hill Republicans, and Phillips said in June that “we have been disappointed” that Republicans have sought to change parts of the health care system rather than simply repealing the 2010 law.

Lansing echoed earlier pledges from the Koch network that the multi-million dollar tax campaign will both support lawmakers who are seen as allies on Capitol Hill and pressure others on issues like the border adjustment tax. The campaign will include advertising, canvassing and rallies in states where AFP is active, in addition to lobbying lawmakers on Capitol Hill. An AFP spokesman declined to give an exact figure for how much the group plans to spend on the campaign.

“Certainly as we move through the process, we’re going to have to take a look at who is with us on tax reform and who is not,” Lansing said. “A lack of support is something [lawmakers] do at their own peril when it comes to 2018. It’s not just something we’re pushing, it’s something voters have been clear about.”

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AFP also sees the coming tax fight as a potential moment to hit Senate Democrats up for re-election in 2018 who hail from red states where tax reform is popular. The Koch network has said it plans to spend $300-$400 million total during the 2018 election cycle, and AFP has 36 state chapters and close to 500 paid staff who knock on doors to persuade voters.

Tax reform is, to some GOP donors, even more tantalizing than Obamacare was before efforts to replace the law stalled.

“Fundamental tax reform is a once-in-a-generation opportunity,” said North Carolina activist and donor Art Pope.

The current gridlock over health care and taxes could lead Republicans to stay home next cycle or, “if the problem is some senators are not working for reform, they may see primary opponents,” Pope said.

Frustration over gridlock on health care is running high among Republican activists and donors. While some Republicans have suggested launching primaries or cutting off donations to Republicans who contribute to gridlock, not everyone agrees on a solution.

Minnesota-based GOP donor Stan Hubbard said Republicans may need such a large margin in Congress that they can’t be “stymied by Democrats” on major legislation.

“In terms of changing these laws, if the American people really want them done, what they’re going to have to do is send more Republicans” to Washington, Hubbard said.