What’s the biggest obstacle in the way of tax reform? Time considers President Trump. He may have called tax reform his top priority, but Congress remains wary of filling in the missing details in the Big Six Unified Framework. Why? “Senior aides on Capitol Hill say they’re not eager to put their bosses’ names on legislation, only to be undercut a few weeks later when the President’s mood changes.”
The White House has a lot of selling to do. A new CBS News/Nation Tracker poll finds that nearly 60 percent of respondents think the “current tax reforms being discussed” favor the wealthy while less than one-in-five think it benefits the middle class. Only one-in-five say they back tax cuts that increase the deficit. The survey was done Oct 11-13.
Tax cuts: Permanent, temporary, or both? Treasury Secretary Mnuchin calls for a mix of permanent and temporary tax cuts, reports The Wall Street Journal (paywall). He said that there should be a permanent move to a territorial tax system, where US multinationals pay no US tax on foreign earnings. Other changes could be temporary, such as immediate expensing of capital investments. Republicans have called for permanent business tax changes, but they’ll have to square up with the budget plan. The Senate may approve a budget this week that allows for $1.5 trillion in bigger deficits over the next decade. But the chamber’s Byrd rule bars measures that add to the deficit after 10 years, at least for bills that pass with only 50 votes.
The estate tax is not about millions of farmers and truckers after all. Mnuchin also contradicted the President Trump’s pronouncement that “to protect millions of small businesses… we are finally ending the crushing, the horrible… death tax.” Pronounced Mnuchin: Repeal of the “estate tax, I will concede, disproportionately helps rich people.” Each year, about 5,000 estates pay the tax. TPC estimates that 80 are family farms or small businesses.
Pick a date, any date, in November, December, or in 2018. While Trump aides continue to insist Congress should get a tax bill to the president by December, GOP senators are lowering expectations. Sen. Tim Scott of South Carolina says “Believing that we’re going to get this done by Thanksgiving is unrealistic.” Sen. Ted Cruz says it will take at least a couple of months to iron out differences within the GOP. He expects Congress to pass a bill early next year. Meanwhile, the president’s decision to scrap cost-sharing subsidies under the Affordable Care Act will be yet another distraction for deeply-divided congressional Republicans. Some want Congress to restore the assistance. Others strongly oppose the idea.
Then again, maybe the government will shut down. OMB Director Mick Mulvaney says the president will oppose any spending bill that does not fund a border wall, even if it means shutting down the government. The last time Trump threatened a shut-down over the border wall, he backed off. The federal government has the authority to spend until December 8.
In Michigan, soda and junk food taxes will never be on the menu. Lawmakers have sent Governor Rick Snyder a bill that bans local governments from taxing food, soda, or gum. No municipalities are considering any such tax, but the legislature wanted to make sure they never try. The bill follows another law that went into effect earlier this year: It bans municipalities from regulating, prohibiting or adding fees to the use or sale of "auxiliary containers” reusable or single-use bags, cups, bottles or other packaging from stores and restaurants.
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