GOP Pushes For ‘Phase Two’ of Tax Cuts

Republicans are increasingly talking about “phase two” of tax cuts — including a permanent extension of the new law’s individual tax cuts — in an effort to highlight their signature legislative accomplishment and force Democrats to take tough votes.

While Republicans could struggle to pass another tax bill this year, conservatives said that an effort to cement the new individual rates would be both smart policy and smart politics.

“I am 100 percent behind that and would support it and even help promote it,” said Rep. Mark Walker (R-N.C.), chairman of the conservative Republican Study Committee.

President Trump and some key lawmakers have made comments in recent weeks about pursuing additional tax cuts following the enactment of the GOP’s tax-overhaul bill last year.

“We’re actually going for a phase two, which will help in addition to the middle class, will help companies, and it’s going to be something I think very special,” Trump said at an event in Missouri on Wednesday.

The same day, House Ways and Means Committee Chairman Kevin Brady (R-Texas) said he plans to release new proposals “this year.”

“We are exploring what good new ideas can be brought forward in tax reform,” he said on Fox Business Network’s “Varney & Co.”

It’s unclear what the exact contents or timing of another tax package would be, but lawmakers and administration officials have signaled that it would likely include a permanent extension of the new tax law’s cuts for individuals.

“It will lead with permanence,” Brady told Fox Business Friday. “The tax cuts for families and small businesses were long term, but they weren’t permanent. We think that’s important for growth and certainty.”

He also said he wants to make tax changes that encourage people to save for retirement.

The tax law Trump signed in December permanently lowered the corporate tax rate from 35 percent to 21 percent. But most of the changes the law made to the individual tax code, including rate cuts, expire after 2025.

The tax cuts for individuals were made temporary in order for the bill to comply with the budget reconciliation rules Republicans were using to pass the measure with only a simple majority in the Senate. Under those rules, the law could not add to the deficit outside of the 10-year budget window.

Republicans are unlikely to adopt a budget resolution with reconciliation instructions this year, so they would need 60 votes in the Senate to pass a second tax bill. The GOP only holds 51 seats, and it could be difficult to get nine Senate Democrats on board with another tax bill.

No Democrat voted for the tax bill last year, citing its large benefits for the wealthy and its impact on the national debt. Top Senate Democrats unveiled a proposal earlier this month to roll back some of the tax cuts, including the lower top individual rate, in order to pay for infrastructure investments.

Some Democratic lawmakers have already raised concerns about plans for additional tax cuts. Rep. Lloyd Doggett (D-Texas), a senior member of the Ways and Means Committee, said at a recent hearing that additional tax cuts that aren’t paid for “will make this [debt] situation even worse.”

Still, some Republicans said they think they could get enough Democrats to pass legislation cementing the individual tax cuts. They noted that many Democratic lawmakers complained that last year’s law included temporary cuts for individuals while making a permanent cut to the corporate rate.

“Democrats said all the time that these tax cuts should have been permanent, so I would expect them to support that legislation,” Walker told The Hill. full story

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About Rhett October 1056 Articles
Rhett October is a man independent of the nanny state. He sees what is obvious but to many others is a successful deception. He has a crush on Tomi Lahren. Follow him on Twitter @RhettOctober "After this, there is no turning back. You take the blue pill—the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill—you stay in Wonderland, and I show you how deep the rabbit hole goes. Remember: all I'm offering is the truth. Nothing more." -Morpheus