Republicans headed for a $4.6 trillion brawl over Trump tax cuts

[BumRushDaShow]

Source: Politico

11/29/2024 03:00 PM EST


As discussions intensify on Capitol Hill over reupping President-elect Donald Trump’s signature tax cuts, Republicans are headed for a massive fight over what could be a nearly $5 trillion price tag. Top House and Senate lawmakers are deeply divided over what, if anything, to do about the hit to the budget that would come by renewing the slew of tax cuts benefiting millions of Americans that are set to expire at the end of next year.

Some, like House Budget Committee Chair Jodey Arrington (R-Texas), are insisting that the effort should not add to the deficit, amid a rising tide of federal red ink. Seizing on the fanfare surrounding a bid by Elon Musk to cut spending, they argue that there are plenty of ways to cut the budget to defray the cost. Among the possibilities: cutting Medicaid, rescinding green energy tax breaks and boosting taxes on corporations’ overseas profits.

On the other side are lawmakers like Sen. Mike Crapo of Idaho, Republicans’ point man on taxes in the Senate, who has long argued against paying much of the cost of any tax agreement. Trump, whose position will hold major sway, doesn’t seem concerned about costs. He proposed during his campaign trillions in additional tax cuts on top of the ones enacted during his first administration. He is floating the idea of using revenue from tariffs on imported goods to cover them.

The debate, which could have ramifications for not just taxes but a host of other policies, will likely spool out over the coming months. Republicans will have to resolve their differences to unlock the arcane “reconciliation” process they intend to use. It would let them sidestep a filibuster by Senate Democrats and muscle through changes to taxes and, they hope, immigration and energy too.

Read more: https://www.politico.com/news/2024/11/29/republicans-major-fight-cost-tax-cuts-00191006

[Bluethroughu]

1. Serfs coming.

The lifeboats are full...

No room for serfs.

[underpants]

4. (taps on shoulder, whispering) None of us knows how to row

Just adding on to a spot on post.

[bucolic_frolic]

2. $3 trillion in new red ink, working class decimated and evicted, inflation roaring.

GOP couldn't balance this budget if they eliminated the entire DOD, DOJ, and shutdown Congress.

[jimfields33]

5. We're screwed. If they don't extend our tax cuts,

Our taxes are going up a lot.

And guess what? The rich tax cuts are permanent.

The only ones hurt by this is the middle and working class.

It’s going to suck!

[nmmi]

7. "If they don't extend our tax cuts, Our taxes are going up a lot."

Last edited Fri Nov 29, 2024, 09:32 PM - Edit history (1)

The tRrump tax cuts (The Tax Cuts and Jobs Act (TCJA) of 2017) doubled the standard deduction. That's great.

But they took away the personal exemption (that's bad), which was almost as big as the increase in the standard deduction. (The personal and dependent exemptions, like the standard (or itemized) deduction, are subtracted from the AGI in order to compute the taxable income that one pays taxes on.

If the tax cuts expire, the standard deduction will go down (bad) but the personal exemption will come back (good).

The dependent exemption will also come back, but the $1,000 increase in the child tax credit will presumably go away. Which is better depends on one's tax bracket.

Finally, tax bracket rates go back up: 10%->10%, 12%->15%, 22%->25%, 24%->28%. Bad.

I post this only because the media, from many reports I've seen, talks about the standard deduction doubling (if the tax cuts expire) but totally leave out mention of the personal and dependent exemptions, and consequently make it sound like it will be hell. For most regular folks, the Trump tax cuts did cut their taxes, but not by all that much.

Edited to add When the tRump tax cuts first were discussed and enacted, most DUers that posted about it said taxes on most ordinary people would go UP. But I didn't think so, and neither did organizations like the Tax Policy Center or the Tax Foundation (caution the latter is RW).

Another edit The tRump tax cuts brought us the $10,000 cap on State And Local Tax (SALT) deductions - bad for many people in high tax states. The expiration of this would be good.

[Bluethroughu]

6. That's their point, Putin wants his payback.

And Eloonitic and orange anus have a big bill to pay...just ask Thomas and ginny.

[nmmi]

3. Renewing the tax cuts will cost a lot more than the original tax cuts (the part that expires at end of 2025) cost

Today, the numbers are all much worse. The price of renewing around 40 provisions set to expire is now estimated to cost some $4 trillion, with another $600 billion in associated interest costs.

At the same time, the federal debt has nearly doubled since 2017, and the increase in interest rates means payments on the debt have become far more onerous. Servicing the debt now costs almost $1 trillion annually.

A lot of the end of the article is about Repukes arguing that tax cuts pay for themselves by stimulating the economy which produces increased tax revenue. This is the "dynamic scoring" thing. Expect to hear a lot more of this bullshit

Among the potential payfors: hiking tariffs, reducing food stamp spending, and so-called dynamic scoring, which takes into account tax receipts generated by increased economic activity that legislation is predicted to generate.

And on and on about dynamic scoring. Emphasis added

Arrington says there are other, less-conventional possibilities too, arguing that Republicans ought to be able to count revenue stemming from the economic boost that comes with reducing regulations, something that’s currently omitted from the congressional budgeting process.

But one has to subtract from this supposed bounty the increased health care costs from dirtier air and water and hotter hot days. But wait, they're going to cut as much health care as they can get away with.

[Probatim]

8. A brawl? Moses Mike and his senate counterpart will ram those tax cuts through their houses

so quickly, you'll wonder if you remembered this article correctly.

[cstanleytech]

9. Best way is to hike the taxes on corporations and the wealthy however that's the stick.

The tasty carrot for the corporations would be hard around how many people in the country have full time jobs of 40 or more hours that provide them and income that's 500% above the Federal poverty level.
The more people that have that the lower the taxes on corporations and the wealthy and the reverse is true as well.
It won't happen though as the wealthy essentially own all branches of our government now, including the Courts.

[MichMan]

12. Don't higher corporate taxes just get passed on to the consumer ?

Same as tariffs?

[Old Crank]

10. The debtor party is at it again.

Trump's record of 8 trillion in debt was made to be broken.

[Mr. Mustard 2023]

11. So they're going to stoke inflation

with tariffs, which will raise taxes on consumer goods, raise our actual income taxes and give it all to the rich. The national deficit caused by Republicans may or many not matter, but if they decide it does matter, the middle class will pay for that too.

Yep, it's a power grab pure and simple. We told you MAGA idiots. We doggone told you.