Republicans in Congress are unconcerned with the possibility of adding to a growing deficit through their attempt to make permanent the tax cuts passed in the GOP tax bill last winter, some of which will sunset after 2025.
While the tax bill dealt permanently with corporate side of the tax code for the most part, many of the individual provisions of the bill were set to expire after a decade in an effort to comply with the procedural rules of the reconciliation process, which Republicans used to pass the bill without relying on support from Democrats.
Republicans now hope to make those temporary provisions more lasting.
“I thought it should already have been done,” said House Freedom Caucus chairman Mark Meadows, who is a co-sponsor of a House measure to do just that.
Asked whether he was concerned with how the cuts may add further to the deficit, Meadows said he was always concerned about the deficit. “But normally, keeping more of the American taxpayers’ money is not a way to balance the budget or address the deficit,” said Meadows. “It’s cutting spending, and we have not been really aggressive enough on the cutting spending side of things.”
The Congressional Budget Office reported last week that the deficit would go up 21 percent in fiscal year 2018 compared to last year, largely due to hefty spending hikes under the GOP Congress, as well as the revenue losses incurred by the tax bill. The CBO projected the tax bill would cost $1.9 trillion (including interest) over a decade. Making permanent the cuts that will sunset after 2025 could add to that price tag by $500 to $600 billion, the Committee for a Responsible Federal Budget estimated last year.
Freedom Caucus member Scott Perry acknowledged that possibility. “You still can’t keep taxing the American people out of their homes and out of their livelihoods,” he said.
President Donald Trump has repeatedly alluded to pursuing a “phase two” of the tax plan, which would involve preserving the individual tax provisions, such as increasing the standard deduction and doubling the child tax credit to $2,000 from $1,000. Newly installed White House economic adviser Larry Kudlow has recently pushed for the tax cuts to be made permanent as well.
The move may ultimately amount to another symbolic measure intended to shore up support among voters as midterm elections approach; It has little chance of passing the Senate, where a bipartisan majority of 60 votes is required.
Still, some Republicans hope the effort could improve public perception of the bill, which has support among just 27 percent of Americans, according to a new NBC/Wall Street Journal poll. Slightly more respondents–36 percent–said the tax bill was a bad idea.
