Senate Democrats castigated Republicans Wednesday for making the individual tax breaks in their tax overhaul temporary in a late-night switch Tuesday.
Republicans made the change to meet Senate budget rules and allow the lowered 20 percent corporate tax rate to be permanent, giving their opponents a pre-packaged narrative: Republicans are risking middle-class tax hikes to give breaks to corporations.
“The American people are learning that individuals are only getting temporary tax cuts out of this Republican bill, but corporations are getting permanent cuts. What a double standard that is,” said Sen. Ron Wyden, the top Democrat on the Finance Committee, speaking at the committee’s markup of the bill Wednesday. “For multinational corporations their handouts are set in stone, written in ink, locked in place with the key thrown away. But not for the middle class.”
In the amended Senate tax bill, all of the major individual tax breaks would expire in 2025, including the lowered tax rates, the doubled standard deduction, the enlarged child tax credits, and the raised exemption level for the estate tax.
Not that Republicans want those tax breaks to expire. Instead, doing so was how they chose to ensure that the bill doesn’t add to the deficit beyond the 10th year. If it did, it would lose its ability to proceed through the special budget procedure that allows it to avoid a Democratic filibuster.
During Wednesday’s markup, committee Chairman Orrin Hatch, R-Utah, said he would support an amendment making the individual tax breaks permanent, if Democrats would join in supporting it, thereby relieving the need for the filibuster-proof legislative vehicle.
Democratic support for the individual tax breaks is likely the reason that the GOP chose to make them temporary, counting on future congresses to renew them.
If the costs of renewing the breaks were included in the score of the bill, the Tax Cuts and Jobs Act, it would score as a bigger tax cut than advertised. The added tax cut would be $240 billion, according to the Committee for a Responsible Federal Budget, an outside group that advocates lower deficits.
Democrats hit Republicans on that point, too.
“Some of our Republican colleagues say, ‘Don’t worry, we’ll extend the middle class tax cuts after 2025.’ That will create a huge deficit,” Senate Minority Leader Chuck Schumer of New York said on the Senate floor. “So I say to my colleagues, particularly the deficit hawks, you can’t have it both ways.”
“This tax plan is immoral and — it increases the deficit,” House Minority Leader Nancy Pelosi said at a rally outside the Capitol opposing Republicans’ tax plans.
“They throw a scrap to the middle class, provide a banquet to the wealthy.”
