Congress Organizing, Planning For Expiration Of 2017 Trump Tax Cuts

One of the biggest issues Congress will face next year, regardless of who wins the election in November, is the expiration of the 2017 Trump tax cuts. In fact, both sides see this as so important they are already discussing possible strategies.

Wednesday, June 12th 2024, 10:09 pm



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One of the biggest issues Congress will face next year, regardless of who wins the election in November, is the expiration of the 2017 Trump tax cuts. In fact, both sides see this as so important they are already discussing possible strategies.

In the Senate, the Finance Committee handles tax policy, and the majority Democrats are reportedly meeting next week to begin crafting possible legislative strategies.

In the House, the Ways and Means Committee has jurisdiction, and the majority Republicans are already actively working up plans to preserve the benefits of the Trump tax cuts bill, known formally as the Tax Cuts and Jobs Act (TCJA).

"We are," said Oklahoma Congressman Kevin Hern, a member of the committee, "Chairman Smith, Jason Smith, has worked on looking at all the components of the tax code."

In April, Rep. Smith (R-MO) announced the formation of ten "tax teams," comprised of Republican committee members, to "study key tax provisions from the 2017 Trump tax cuts that are set to expire in 2025 and identify legislative solutions that will continue to help families, workers, and small businesses," Smith said in a release.

The team's areas of focus include American manufacturing, working families, supply chains and global competitiveness, which is the team Hern chairs.

"As the 2017 Tax Cuts and Jobs Act was implemented," Hern (R-OK1) said in an interview Wednesday, "other countries responded by lowering taxes and changing their tax code, so we need to see how this all fits together for a tax code that needs to be moved into 2026 and beyond."

Among the provisions of the law that are set to expire at the end of 2025 are lower marginal tax rates, the increased standard deduction and child tax credit, and the higher estate and gift tax exemption.

"And so right now it’s going to be a $4.2 trillion tax hike (collectively) on individuals starting in January of '26," Hern explained, "because all these codes are going to expire."

As much as the Biden administration has criticized former President Trump's signature legislative achievement, they dispute the Republican claim that, if Biden is reelected, middle-class Americans will face higher taxes.

"The president has been very clear that no family earning less than $400,000 will face a tax hike," Treasury Secretary Janey Yellen told Rep. Smith at a recent committee hearing. "He's not proposed such a thing since he took office and he's not proposing to allow that to happen when parts of TCJA expire."

Hern says, given that extending the tax cuts could potentially add to the national debt, he's not certain he would support leaving everything as it currently is, especially if inflation hasn't improved and interest rates are high.

"All of those make it a little more precarious," said Hern, "and how we extend those, what we modify, what we eliminate, we have to look at all of these and everything is

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