Pence to address Anderson crowd on tax reform, but most important audience is Sen. Donnelly

WASHINGTON – Vice President Mike Pence will pitch the Trump administration’s plan for an overhaul of the federal tax code in a speech in Anderson on Friday after meeting with local business leaders and families.

But his most important listener is Sen. Joe Donnelly.

The Indiana Democrat is one of the Trump administration’s best hopes for winning over some Democrats to a tax plan that has yet to be detailed.

Donnelly, who is eager to show he’s willing to work with Republicans at times, will be at the event.

So will Reps. Todd Rokita and Luke Messer, two of the Republicans seeking the nomination to challenge Donnelly next year.

If Republicans can’t win Donnelly’s vote, they could get a campaign issue.

“We’re willing, ready and able to activate our grassroots in a significant way to hold Sen. Donnelly accountable if his rhetoric doesn’t match with his position when it comes to tax reform,” said Justin Stevens, who heads the Indiana chapter of Americans for Prosperity — the grassroots arm of the political network controlled by billionaires Charles and David Koch.

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Although Donnelly votes with his party most of the time, he’s willing to cross party lines more often than most. He’s done that on some tax issues, including in 2010 when he backed a package of tax cuts he said was not perfect but was needed to provide certainty in the tax code and incentives for economic growth.

Donnelly and the other two Senate Democrats who were invited to the White House this month for a dinner discussion with President Donald Trump were the only three who did not sign on to an August letter sent by Democratic party leaders outlining what conditions would need to be met for the minority to support tax reform. (The other two Democrats were Joe Manchin of West Virginia and Heidi Heitkamp of North Dakota, who also have been singled out by Pence or Trump in recent visits to their states for tax events.)

Most Democrats said they won’t support tax cuts for the wealthiest Americans, and won’t vote for an overhaul that adds to the deficit.

As the only Democrat elected statewide in a state Trump won by 19 percentage points last year, Donnelly is a top target for Republicans looking to expand their narrow Senate majority.

“Make no mistake, Joe Donnelly is feeling the pressure, and he may be forced to do something he doesn’t want to do — give Hoosiers a tax cut,” Messer said in a statement.

Rokita's campaign said this past week Donnelly needs to "to stand up to the liberal obstructionists in his own party and actually support tax reform, not just use a White House visit to try to fool Hoosiers."

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Donnelly said he wants a bipartisan effort that will give working and middle-class families greater economic security. He's specifically pushing changes to reward companies that keep jobs in the United States and penalize businesses that move them overseas.

"When the president has ideas that are good for Indiana and Hoosier families, I am more than happy to work with him," Donnelly said in a statement after his dinner with Trump.

In a statement released Thursday, Donnelly called it “an honor to welcome the vice president back home to Indiana.”

Gov. Eric Holcomb and Rep. Susan Brooks, R-Carmel, also are expected to attend.

Friday's trip is one of three Pence is expected to make in recent weeks to push for tax legislation. And  Trump is expected to visit Indiana next week. 

“Indiana is a big part of our strategy and the White House’s strategy,” said Sean Lansing, Americans for Prosperity’s chief operating officer.

When the group kicked off a nationwide tour for a “fairer, flatter and simpler” tax code in August, Indiana was the first stop. They held events in Indianapolis and Fort Wayne. They have more activities planned — including door knocking and phone calls — to their base of 70,000 Hoosier activists. And if Donnelly looks like he’s wavering on tax legislation, the group promises to unleash mailings, advertising and other methods of persuasion.

Another group, a coalition of businesses and associations pushing to lower the corporate tax rate, also has been active in Indiana. In advance of Pence’s first visit, the Reforming America’s Taxes Equitably (RATE) coalition held a roundtable discussion in Indianapolis with executives from Cook Medical, AT&T of Indiana, Indiana Restaurant and Lodging Association and Big Red Liquors.

But Polls show tax reform isn’t high on voter’s list. Taxes ranked below health care, jobs, terrorism, immigration, climate change and the U.S. relationship with Russia as the most important issue facing the nation in a July Bloomberg National Poll of 1,001 adults.

In a September NBC News/Wall Street Journal poll, a plurality — 42 percent — said Congress should not cut taxes.

The Pew Research Center has found in recent years that most Americans think they’re paying about the right amount of taxes. Their top frustration is that some corporations and the wealthy don’t pay their fair share.

The one-page outline of tax policy goals Trump released in April included lowering the top corporate rate to 15 percent from 35 percent and cutting the top individual income tax rate to 35 percent from 39.6 percent. The tradeoff could be an elimination of some tax breaks that benefit corporations and the wealthy, but that would create winners and losers — and the losers won’t like it.

“We understand there’s a lot of land mines, and a lot of people trying to get hang onto what they’ve got,” said Kevin Brinegar, head of the Indiana Chamber of Commerce.

Tax reform is a top priority for the chamber, which will be sending more than 100 members to Washington, D.C. next week for its annual lobbying trip.

“What comes out in the next week, months, that’s what we’ll be watching,” said Andrew Berger, vice president of governmental affairs for the Indiana Manufacturers Association.” While we know there has to be trade-offs, making the rate more competitive with the rest of the world is a big priority for our members.”

Contact Maureen Groppe at mgroppe@gannett.com. Follow her on Twitter: @mgroppe.