What Trump isn’t saying on tax plan: Some will pay more
President Donald Trump leaves little doubt about how great his tax overhaul is going to be when he is in front of crowds, urging them to pressure Congress to pass it.
But what the president does not mention is that some people — one study said 1 in 5 people making between $86,100 and $149,400 — will end up paying more. The challenge Congress faces in passing the tax package is getting lawmakers whose constituents would pay more to vote for it.
Right now, Trump’s advisers and his supporters in Congress are working to downplay any mention of paying more, even though that is an inevitable part of the kind of overhaul they are planning, which involves eliminating deductions and credits to produce lower rates overall.
Any tax bill is a tradeoff: It needs to raise taxes in some areas to generate revenue to offset the tax cuts that reduce the government’s revenue.
“If you are a tax writer on the Hill, the president’s rhetoric must drive you crazy, because you know you can’t write a tax bill that lives up to that,” said Robert Bixby, executive director of the Concord Coalition, a nonprofit that crusades against increased debt.
“I don’t think we can have the Oprah tax reform, this idea of, ‘Everybody gets a car, the keys are under the seat,’ ” Bixby said.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said delivering tax cuts for everyone would work only if there is a big budget surplus and low debt.
“That’s the opposite of the fiscal environment they have now,” she said.
Supporters of the tax package have gone from saying lower rates would be fully offset by cutting deductions and credits to saying it would be offset by future economic growth, a stance that MacGuineas and Bixby said is unsupportable and could derail passage.
“Unless it reduces deficits ... with reasonable and responsible growth models, and unless we can make it permanent, I don’t have any interest in it,” Sen. Bob Corker, R-Tenn., said last week.
Using data from earlier plans outlined by House Republicans to fill in some of the blanks in Trump’s plan, the nonpartisan Tax Policy Center estimated that 13.5percent of taxpayers who earn between $48,600 and $86,100 would see a tax increase, averaging $1,000.