House Republicans propose more tax cuts as elections near

[james.hendrickson]

By
David Morgan, Amanda Becker

WASHINGTON (Reuters) - Federal individual income tax cuts approved in December on a temporary basis would become permanent under a package of bills unveiled on Monday by Republicans in the U.S. House of Representatives, although the outlook for passage was uncertain.



In an election-year effort designed to draw a sharp contrast between themselves and Democrats, House Republicans offered up three pieces of legislation.

The measures would make permanent the lower individual rates from December, eliminate the maximum age for some retirement account contributions and let new businesses write off more start-up costs.

President Donald Trump’s Republicans, who are seeking to fend off a Democratic challenge for control of Congress in the Nov. 6 elections, tout the tax cuts as helping boost the economy. Democrats have said they benefit mainly the wealthy and corporations.

“Regardless of the merits of the House GOP plan, we view it as a political move ahead of the midterm elections that has no chance of passing Congress in the short term,” the investment firm Keefe, Bruyette & Woods said in a Monday note to clients.

The Senate has shown little willingness to take up another round of tax cuts that would balloon the federal deficit even more than December’s cuts did, analysts said.

Even in the House, they said, Republican leaders could have trouble mustering the 216 votes needed to pass the measures, given the projected deficit impact.

“Adding another several hundred billion dollars to the deficit is something that I think some Republicans are going to really think hard about,” said John Gimigliano, who heads federal tax legislative and regulatory services at the audit, tax and advisory firm KPMG LLP.

“Passage is not automatic,” he added.


Reporting by David Morgan and Amanda Becker; Editing by Kevin Drawbaugh and Peter Cooney

Linky:

[kork13]

Yeah, it's basically a non-starter... DOA.

[Tabs]

I wish the people of this country would take a good, hard, NON-PARTISAN look at supply side economics, and how it threatens our country's long term survival. A shame that might be asking too much though.

[disneysteve]

I wish the people of this country would take a good, hard, NON-PARTISAN look at supply side economics, and how it threatens our country's long term survival. A shame that might be asking too much though.

Exactly. I wish the politicians would do the same. You can't cut taxes without cutting spending an equivalent amount. That's how math works.

[kork13]

I wish the people of this country would take a good, hard, NON-PARTISAN look at supply side economics, and how it threatens our country's long term survival. A shame that might be asking too much though.

The 'non-partisan' piece is the difficult part. For a variety of reasons, American politics has become fractured and radicalized such that "non-partisan" or "independent" are almost swear words. For the record, I agree with you. But looking realistically at the current political environment, this legislation has no chance of becoming law. It's not simply because politicians can't get behind more/permanent tax cuts. It's also the back half of what those tax cuts would mean -- either ballooning deficits even further, or ::gasp:: reigning in government spending (another series of swear words). Taxes & regulations can't simply be reduced without consequence, and the appetite for those consequences simply doesn't exist right now, both in congress and in the populace.

[james.hendrickson]

Um well, the possibility of relaxing rules around retirement accounts is the exciting part. A lot of people who haven't saved in their younger lives need to contribute more later to catch up - so relaxing those rules could have a benefit for later retirement savers.

[Thrif-t]

eliminate the maximum age for some retirement account contributions

^ What is this? What maximum age??

Or is this talking about RMD and doing away with having to take withdrawals at 70 1/2??

[LivingAlmostLarge]

I'm pretty liberal but I'm a little stunned we're cutting taxes more without even discussing how to cut spending