Republicans are breaking four big promises in the Senate tax bill
WASHINGTON — Republican senators last night hit a snag on their tax plan (more on that below), and so the votes will resume at 11:00 am ET with no one knowing what the next steps will be to pass the legislation.
But here’s what we do know — at least so far — about the Senate bill: It breaks four key promises that Republicans have made about their entire tax reform effort.
Claim #1: The tax legislation won’t increase the debt. “I believe tax reform will lead us back to a balanced budget,” House Ways and Means Committee Chair Kevin Brady said .
The facts: The Joint Committee on Taxation said Thursday that the Senate bill would add $1 trillion to the debt, even after accounting for economic growth, the Washington Post reports . (Senate Finance Committee Chair Orrin Hatch said the JCT analysis isn’t correct, because Republicans are still writing the bill.)
Claim #2: The tax plan was designed to benefit the middle class. “This is designed to be a middle-class tax cut,” House Speaker Paul Ryan told NPR .
The facts: Under the Senate bill, the corporate tax cuts are permanent, while those for individuals are temporary. So by 2027, even if you exclude the elimination of the individual health-care mandate from the analysis, the Congressional Budget Office says the wealthiest will get a tax cut, while those making less than $75,000 will get a tax increase. (Republicans have said that future Congresses will extend those temporary tax cuts.)
Claim #3: Wealthy people like Trump won’t benefit. “This is going to cost me a fortune, this thing -- believe me. Believe me, this is not good for me,” Trump said earlier this week .
The facts: The wealthiest, including Trump, are the biggest beneficiaries under the Senate bill. According to the Tax Policy Center , by 2027, the wealthiest get nearly 62 percent of all benefits under the Senate bill (while two-thirds of middle-class Americans would face a tax increase). What’s more, per NBC’s own analysis , Trump and his family could save more than $1 billion under the House bill.
Claim #4: The tax cuts would significantly grow the economy . “These massive tax cuts will be rocket fuel ... for the American economy,” Trump said this week .
The facts: The Joint Committee on Taxation said the Senate bill would grow the economy by 0.8 percent more over the next decade. That’s growth, but it’s not rocket fuel.
Senate tax bill hits a snag
NBC’s Frank Thorp reported last night that Senate stopped voting on anything related to the GOP tax bill. What derailed the process?
- The JCT score showed that while they projected the economy to grow slightly as a result of the bill, it would still add $1 trillion to the deficit over the next 10 years.
- The Senate Parliamentarian told Republicans that the so-called “trigger” that some senators wanted to kick in to raise revenues if growth was not good enough was not in line with Senate rules, so it needed to be taken out. That lost them the votes of Sens. Bob Corker, R-Tenn., and Jeff Flake, R-Ariz.
Per Thorp, there’s now a Rubik’s Cube of four Senate Republicans who have concerns that need to be addressed:
Sen. Corker: Worried about deficits – wanted a trigger
Sen. Flake: Worried about deficits – wanted a trigger
Sen. Ron Johnson, R-Wis.: Worried about provisions related to deductions for pass-through businesses (he wants them higher) (Johnson's office confirmed to NBC's Garrett Haake on Friday morning that he is now a yes on the bill.)
Sen. Susan Collins, R-Maine: Wants protections for a deduction for state and local taxes. (She also has health care concerns)
Thorp adds: Leadership is trying to figure out a way to move around the money in a way that will lock in at least two of the above Republicans, as they can only lose two votes to pass the bill One or two of these Republicans could be left behind. There is a discussion about whether they could just include an automatic tax increase (likely on the corporate side) to help raise the revenue needed to get Corker and Flake on board. That’s a work in progress.
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So looks like it will pass .. I was hoping to see more snags, thus triggering more discussion and debate over adding to the debt.... Where are the fiscal hawks... or is spending money only bad when the (D)'s have the WH and raise the debt?