President Trump’s Tax Reform Imminent, as Senate Passes Budget
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Late Thursday, Senate Republicans pushed a $4-T budget through in a major step forward for President Trump’s promise of massive tax cuts and reform.
The 51-49 vote set the stage for debate later this year to dramatically overhaul the US tax code for the 1st time in 30 years, cutting rates for individuals and corporations, and eliminating trillions of dollars of deductions and special interest tax breaks.
The tax cuts would add up to $1.5-T to the deficit over the coming decade, as Republicans shelved fears about the growing budget deficit in favor of a once-in-a-generation opportunity to rewrite tax laws.
The Trump Reforms change incentives and drive growth, and the Congress has never done that before.
When reconciled with the House budget plan, the nonbinding measure would set up special procedures to pass follow-up tax legislation without the threat of a filibuster by Senate Democrats.
Pressure is mounting on the House to simply adopt the Senate budget plan rather than risk lengthy negotiations that could delay the tax measure.
House Speaker Ryan (R-Minn) has signaled that will happen, and House Majority Whip Steve Scalise, (R-LA) called on Congress to “lower taxes for everybody” to help “rebuild the middle class” and bring back jobs to the United States.
Senator Rand Paul (R-KY) voted against the budget. He said the measure permits too much spending and abandons the GOP drive to repeal Barack Obamacare. An amendment by Senator Paul to revive the “Barack Obamacare” repeal failed by a 2-to-1 margin.
The nonbinding budget resolution is supposed to lay out a long-term fiscal framework for the government. This year’s measure calls for $473-M in cuts from Medicare over 10 years and more than $1-T from Medicaid.
Senate Republicans would cut spending by more than $5-T over a 10 year frame.
The measure does not promise to balance the budget, projecting deficits that would never drop below $400-B.
The budget measure would revive efforts to permit exploration for oil in Alaska’s Arctic National Wildlife Refuge, permitting legislation opening up ANWR to drilling to catch a ride on the popular tax measure.
Asian shares and USD gained on Friday after the Senate approved a budget blueprint for the FY 2018 that paves the way for Republicans to pursue a tax-cut package without Democratic support.
Expect the US stock market to receive this news favorably Friday.