GOP Considers Hybrid Approach to Tax Reform
Congressional tax committee members and the White House are discussing tax reform that combines permanent revisions to the tax code with temporary rate cuts for individuals and businesses. The proposal is a potential solution for Republicans if the party opts to utilize the reconciliation process, which limits the life of tax cuts adding 10 years to the federal deficit. (The effect of lowering the corporate tax rate to 15%, elimination of several tax brackets and doubling the standard deduction, as set forth in the White House’s tax plan released in April, would result in the estimated loss of $5 trillion dollars over ten years.) While officials are still considering whether some reform proposals, such as immediate expensing, might be made permanent, there is broad consensus that adoption of a territorial tax system should be permanent.
Republicans Discuss a Mix of Temporary, Permanent Tax Changes