WASHINGTON – The race to leverage the tax code is in full swing as economists and advocates across the political spectrum see the expiring Trump-era tax law as an opportunity to advance their economic priorities.
Democratic Rep. Suzan DelBene of Washington said Wednesday that overhauling the tax code would be a “reflection of our values.”
DelBene, who serves on the U.S. House of Representatives’ Ways and Means Subcommittee on Tax Policy, said her priorities include modernizing the tax code, raising revenues through carbon taxes on imported goods and making the expanded tax credit indefinite. for children, following the example of momentary changes in place during the pandemic.
“The most important thing is to start with what our values and goals are and then look at the policies that will help us get there,” DelBene said during a Politico-sponsored discussion on proposed tax law changes.
The morning event at Union Station in Washington, D.C. featured tax experts and advocates from Georgetown University Law Center, the Urban Institute, the Heritage Foundation and the Groundwork Collaborative.
Tax renovation
A massive tax overhaul enacted during the Trump administration permanently lowered the corporate tax rate to 21% from 35%. The Act of 2017, championed by Republicans as the Tax Cuts and Jobs Act, also introduced several momentary measures for corporations and compact businesses. Some are being phased out or have already expired, which includes immediate deductions for some investments.
The momentary changes for households included across-the-board tax rate cuts, a doubling of the child tax credit and a near-doubling of the standard deduction – all set to expire on December 31, 2025.
A bipartisan momentary bill extend expiring business incentives AND extend the child tax credit beyond 2025 passed the House of Representatives in overdue January but was stopped by U.S. Senate Republicans, who oppose some proposals to extend child tax credit.
Nonpartisan Congressional Budget Office May 2024 report extending the tax cuts is estimated to cost about $4.6 trillion over 10 years. According to an., most of the costs would result from maintaining individual tax cuts analysis report by the Bipartisan Policy Center.
Critics the 2017 laws point to recent March analysis from scientists and members of the Joint Committee on Taxation and the Federal Reserve, which concluded that the benefits of the act went to the highest earners.
DelBene stated that, returning to the corporate tax rate, even on the Republican sideis “on the table” and lawmakers will talk about it “where the TCJA was not about investing and making sure we are fiscally responsible.”
“Incredibly bullish”
Lindsay Owens, executive director of the Groundwork Collaborative, said Wednesday that she is “extremely optimistic” that elected officials will make “fundamental changes” to the tax code next year.
A progressive think tank sent a letter to House and Senate leaders and top tax writers on Wednesday, urging them to “use the expiration of these provisions as an opportunity to address long-standing problems with our tax code, not just tinker around the edges.”
The letter was signed by 100 organizations from across the United States, from the AFL-CIO and the United Auto Workers to the National Women’s Law Center and the United Church of Christ.
Casey’s report details how Trump-era tax changes have devastated elderly fraud victims
Stephen Moore, who helped write the Trump-era tax bill and is now a senior fellow on economics at the conservative Heritage Foundation, said the 2017 bill was a “tremendous success” and that “we will definitely make these tax cuts last.” .
Moore is an economic adviser to former President Donald Trump’s re-election bid, but said he does not speak on behalf of the president’s campaign.
He said he disagreed with Trump on everything, including his promise to impose 10% tariffs on imported goods, rising to as much as 60% on Chinese imports.
“The tariff is simply a consumption tax,” he said. “And as you know, I don’t think that’s great policy. But if you want to impose a tariff, I’d rather have a single tariff than try to impose a protectionist tariff to, you know, protect this or that industry.”
When pressed on data showing funding for the Internal Revenue Service increases revenue, Moore said President Joe Biden’s augment in funding for the agency is “diabolical.”
