By David Morgan and Roberta Rampton
WASHINGTON (Reuters) – President Donald Trump and Republican U.S. lawmakers on Tuesday discussed another possible round of deficit-financed tax cuts, highlighting an initiative seen by some tax experts as an election-year effort with little chance of becoming law.
Trump sat down at the White House with Kevin Brady, chairman of the House of Representatives tax-writing committee, and a handful of other Republicans from the panel to plot a path forward on further tax cuts that would appeal to their conservative political base ahead of the Nov. 6 elections.
The discussion began only after Trump sought to defuse intense criticism leveled at him by lawmakers in both parties over his summit meeting on Monday with Russian President Vladimir Putin in Helsinki, saying he misspoke about Moscow’s meddling in the 2016 U.S. election.
Trump then introduced Brady to reporters gathered in the conference room. Facing Trump, Brady said, “We’re here to talk to you about making permanent this tax relief.” After Brady’s brief remarks, reporters were removed from the room by shouting Trump aides.
Over the unanimous opposition of Democrats, Republicans in Congress in December passed deep tax cuts for corporations on a permanent basis, and for individuals, families and private businesses on a temporary basis.
Republicans have described the cuts as critical to boosting U.S. economic expansion. Democrats have called the cuts a giveaway to corporations and the wealthy that will run up deficits and burden U.S. taxpayers for years to come.
House Republicans now say they want to make permanent the $1.1 trillion in temporary cuts for individuals, families and private businesses that are set to expire in 2025. Brady’s panel calls the legislative package “tax reform 2.0,”
The Senate, however, is unlikely to take up a new tax bill before the election in which Trump’s fellow Republicans are seeking to retain control of Congress. Brady told Trump he expected a House vote on a tax cuts bill in September “and the Senate setting a timetable, as well.”
After the 45-minute meeting with Trump, Brady told reporters on Capitol Hill, “We talked about timing and the importance of this. … We’re very well aligned with the White House on 2.0.”
The nonpartisan Congressional Budget Office has already warned that making permanent the temporary cuts would further expand the federal deficit and debt. Both measures of red ink increased with the Republicans’ $1.5 trillion December tax cuts package and a $1.3 trillion bipartisan spending bill in March.
Brady has said he does not expect the Republicans’ new bill to be “revenue neutral,” meaning it would expand the deficit.
Trump has separately said he is considering cutting the U.S. corporate income tax rate again to 20 percent from 21 percent.
In December’s tax overhaul, Trump and Republicans in Congress slashed the corporate rate from 35 percent.
Brady said that tax cut set the stage for other countries to respond with new cuts of their own that lawmakers may have to match. Some tax activists have warned of a global corporate tax “race to the bottom” among advanced economies.
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Source: Investing.com
