With his tax effort in peril, Trump to push Congress for swift action – Washington Post
President Trump on Wednesday will pressure Congress to pass a sweeping package of tax cuts by year’s end, but he is not planning to advance a specific plan.
His push comes as a divided Republican Party and a number of other external forces — including the devastation caused by Hurricane Harvey — imperil his bid for a major legislative achievement.
In a speech delivered to supporters in Springfield, Mo., Trump plans to make a populist argument for cutting taxes, saying it will help raise wages and boost economic growth, said senior administration officials who spoke on the condition they not be named.
One of the officials said Trump is going to try to tap into a view among many Americans that “the economy is rigged — that it only benefits a very small [number of] wealthy and well-connected few … The president is going to really hammer on that.”
So far, the president has not advanced any proposal that would — on net — raise taxes on the wealthiest Americans. While the officials said Trump is not planning to offer new details Wednesday, many he has offered in the past, such as cutting the estate tax and lowering rates on investment income, would likely lead wealthier Americans to pay less.
Republican congressional aides and several tax lobbyists said Tuesday there is no consensus within the GOP about how to proceed. But some lawmakers are now considering a package of both permanent and temporary tax changes that they hope can get enough political support, said Rohit Kumar, a former top tax aide to Senate Majority Leader Mitch McConnell (R-Ky.). Kumar, who is now leader of the tax policy services practice at PwC, said it has still not been decided what tax changes lawmakers will propose making permanent and which ones would only be temporary.
Lawmakers could decide to phase some tax changes in, phase some other tax changes out, or pass the law in a way that makes changes “sunset” after a certain number of years.
In the past, Democrats and Republicans have proposed cutting tax rates for a set number of years as a way to deliver short-term tax cuts while stopping short of permanently changing the tax code. White House officials have said they are open to temporary changes if they can’t secure enough support for long-term overhaul.
These are some of the many questions that remain unresolved as GOP leaders try to write the tax plan. Among the most pressing is whether the tax changes will increase the budget deficit, which would happen if any plan cuts tax rates without offsetting the lost revenue by eliminating certain deductions.
“The big issue that overrides all of this is whether this is going to be a tax cut and who is going to get the cuts,” said Michael Mundaca, a former top tax policy official in the Obama administration who is now co-director of the national tax department at Ernst & Young.
Asked about this last week, McConnell alluded to it being an issue, saying “There’s some internal debate about that that we’ll have to sort out among ourselves.”
A tax overhaul is one of several items competing for Congress’s attention, and while the White House and GOP leaders plan to continue negotiating, they’re confronting a daunting fall political calendar.
Congress is only scheduled to be in session for brief periods in September, and they must also reach an agreement to prevent a government shutdown by October and pass a bill to suspend the debt ceiling before Sept. 29. Congress also must decide whether to reauthorize a government flood insurance program and a health-care program for low-income children.