Team Trump is hard at work on its third tax plan in less than a year. First, the campaign took a stab, then the transition team, and now Treasury Secretary Steve Mnuchin is spearheading yet another effort that the White House plans to shepherd through Congress under Donald Trump's steady leadership. But the new effort has some Trump allies a little worried, writes Politico.
“There's no reason for Treasury to rewrite the tax plan,” said Stephen Moore, a senior economist at the conservative Heritage Foundation who helped draft the Trump campaign’s tax plan. “Trump already has a great tax plan he ran on in the campaign.” That plan slashed tax rates for individuals and corporations to the tune of trillions of dollars.
Moore's apparently shocked, just shocked that Trump's gone hot and cold on a policy proposal—gee, he just seemed so rock solid on the campaign trail. (The only thing Trump was truly committed to as a candidate were his nativist anti-immigrant policies, all of which he's attempted to make good on.)
Paul Ryan may also be in for a surprise.
One senior administration official said the plan being drafted by Mnuchin is unlikely to include Ryan’s controversial border adjustment tax. The trouble is that that proposal generates much of the revenue in Ryan’s plan, one potential blueprint from which the administration could work. Without it, one Hill staffer in favor of the plan said, “the offsets become a lot more ugly.”
In other words, if the White House scraps Ryan's border adjustment tax (BAT) which would bring in an estimated $1 trillion in revenue, it becomes nearly impossible to cut taxes without adding to the deficit/debt (unless Steve Bannon figures out a way to simply dissolve the federal government). Failure to put forth a revenue-neutral tax package would ultimately force Republicans to sunset their tax cuts after ten years or less instead of being able to make them permanent. It's essentially the difference between true tax reform—which would permanently overhaul the tax/revenue scheme—versus simply cutting taxes for a finite period of time.
Needless to say, Ryan and House Republicans aren't super excited about surrendering control of tax reform to the White House, which also isn't super keen on watching the House GOP crater Trump's next legislative effort. A “fine-tuned machine,” indeed.