With healthcare bill dead, Republicans turn to taxes
| WASHINGTON
WASHINGTON After failing to repeal Obamacare, Republicans in the U.S. Congress quickly pivoted on Friday to President Donald Trump's next priority: overhauling the federal tax code, but their plan has already split the business community.
Division among Republicans was the chief cause of the embarrassing setback on Obamacare, and similar fault lines have been evident for months in the Republicans' tax plan, mainly over an untested proposal to use the tax code to boost exports.
House of Representatives tax committee Chairman Kevin Brady conceded the demise of a Republican plan to roll back Obamacare could make the path to tax reform harder. "This made a big challenge more challenging. But it’s not insurmountable," he told Fox News after Ryan canceled a vote on an Obamacare rollback bill.
But Brady said he and House Speaker Paul Ryan are all-in on tax reform.
Brady said House Republicans plan to begin moving on tax reform this spring and to pass legislation before Congress's summer recess in late July.
"We’re going to work with the administration to get this done,” he said.
Trump has been unclear about his position on the most problematic feature of the House Republicans' tax "blueprint," a proposal known as the border adjustment tax that would cut taxes on exports and raise them on imports.
Treasury Secretary Steven Mnuchin said on Friday that tax reform in many ways is "a lot simpler" than healthcare reform.
"We're able to take the tax code and redesign things and I think there is very, very strong support," Mnuchin said at an event hosted by news website Axios.
Comprehensive tax reform is a policy goal so complex that it has defied successive Congresses and presidents since 1986 when it was last accomplished under former President Ronald Reagan.
The U.S. tax code is riddled with narrow subsidies and loopholes, many of them deeply embedded in the economy and defended by the interests they benefit, such as the mortgage interest deduction and the business interest deductibility.
Brady's panel has been working on a plan since mid-2016 that would cut the corporate tax rate to 20 percent from 35 percent, end taxing foreign profits for U.S.-based multinationals and cut other tax rates for businesses and investors.
The plan has divided businesses, prompting import-dependent industries to warn of higher prices for consumer goods from clothing and electronics to gasoline.
Brady has been adamant that border adjustment will be part of the House tax reform, saying earlier this week that the provision was "a given" for final legislation but would include a transition period for import-heavy industries.
(Additional reporting by Eric Walsh and David Lawder; Editing by Kevin Drawbaugh and Bernard Orr)
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After the humiliating defeat of the republican healthcare plan, the republicans are trying to pivot to taxes as quickly as possible.
I believe that they are going to run into the same divide that they did with healthcare.
''But Brady said he and House Speaker Paul Ryan are all-in on tax reform.''
Ryan was all-in on the healthcare bill, and that didn't go well at all.
We live in interesting times.
It's going to be a much heavier lift then the repeal and place was, once the Democrats show that it, like repeal and replace, is going to screw the middle class and poor in favor of the rich.
I think your right on that Randy....It's going to get interesting and quickly.
''Brady has been adamant that border adjustment will be part of the House tax reform, saying earlier this week that the provision was "a given" for final legislation but would include a transition period for import-heavy industries.''
Nothing is a given, especially adding a tax to business.
The real world may slap Brady soon.
Yeah, and Ronald Reagan's generous tax break netted me $0.33 every two weeks. If I saved the money for 6 weeks, I could buy a coke! Maybe.
I look forward to this, (not).
LOL, and that would be a small coke, not the jumbo coke, Dowser.
Oh my wife and I really made out on the Dubya on. We netted a whole $20 a year between us. Back then I could buy a pair of jeans AND a pair of socks! I felt like a Rockefeller!
One out of a coke machine... Not a full 2-liter.
Healthcare went down because there was Republican opposition.
There won't be any such thing on tax "reform". All Republicans agree on lower taxes for the rich and higher taxes for everyone else.
All Republicans agree on lower taxes for the rich and higher taxes for everyone else.
True. But there are other aspects of "tax reform" that will probably divide them.
One such thing is the so-called "Border Adjustment Tax" (a tax on imported goods). There is YUGE opposition to this from some major American industries.
So Trump may find himself facing opposition from some Republicans on this issue as well.
The ''border tax'' IMO, will be a obstacle for the republicans. Business may not go along with that.
Of course the tax breaks will be for the rich, that's a given.
The ''border tax'' IMO, will be a obstacle for the republicans. Business may not go along with that.
Whoops-- just posted my previous comment before I saw this one.
Yes-- its going to be a big problem for him.
Some sectors would shrivel up and die. Especially retail-- at least the clothing. Most clothes are manufactured abroad.
Some sectors would shrivel up and die. Especially retail-- at least the clothing. Most clothes are manufactured abroad.
In addition, many things are not manufactered either totally domestically or totally abroad. Some things manufactured mostly in the U.S. use imported part-- a border import tax on those would make the end product so expensive it would hurt the manufacturers. (One example: many "U.S.-made" autos).
And some things do use American-made parts-- but are assembled in places like Mexico before being importd back into the U.S.
The border tax would hurt the American consumer-- but it would hurt many American businesses even more so. (So they'd either downsize-- or go out of business entirely. Meaning more American jobs lost...because of the actions of our "Loser-in-Chief").
I womder if Trump really thinks that "pro-business" Republicans in Congress would go along with the anti-business border tax?
''I womder if Trump really thinks that "pro-business" Republicans in Congress would go along with the anti-business border tax? ''
There is that, and the fact that republicans are free traders...
It's going to be interesting....You can bet that anything that gives corporations and the wealthy a tax break will be unopposed.
The border tax is gong to throw up a divide in the republican party.
Getting the popcorn ready.
Trump will try to sell it as Pro-American by making imported goods (especially those from the evil Mexico and China) more expensive so people will but American. The only problem is that most of the items that will be affected are not and will not be manufactured in America because it's still, border tax included, too expensive to do. Trump could make the border tax 100% and it still wouldn't bring most of those jobs back.
What it would do is cause a massive plunge in consumer spending (the main driver of our economy) and confidence, which would send the economy into a deep recession as Americans just plain stopped spending on all but the most basic necessities. Without consumer spending, the economy collapses.