Further Tax Cuts are the Height of Fiscal Irresponsibility
For Immediate Release
The House Ways and Means Committee released “Tax Reform 2.0" Monday night, which would make permanent most of last year’s tax bill that largely expires in 2025 under current law. Press reports indicate the Joint Committee on Taxation has estimated the package costing $657 billion. The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:
This is a plan built on quicksand – sinking in the very debt that finances it. Not only will it add hundreds of billions to the deficit, but it may actually slow long-term growth, especially if recent spending increases are also made permanent.
The $657 billion score of the plan understates its true costs, since it is mostly over the final three years. We estimate the legislation will cost $4 trillion over the next 20 years, or $5 trillion with interest.
Tax reform 2.0 should be about correcting the first round, not locking in its mistakes.
Debt-financed tax cuts do not pay for themselves, and they certainly won’t stimulate the economy into surpluses.
With trillion-dollar deficits coming as soon as next year according to the White House’s own projections, it is beyond irresponsible to put even more tax cuts on the national credit card to fuel an economic sugar high that won’t last.
Our society is aging, and our largest trust funds and social programs are running out of money. It’s a fiscal hole in the trillions that isn’t going to be fixed with more unpaid-for tax cuts.
The tax cut bill was a sad, missed opportunity. Congress should scrap this plan and pursue real tax reform that broadens the base to finance lower rates, closes loopholes, simplifies the code, and creates lasting economic growth while reducing or at least not worsening the national debt. And while they are at it, they should control spending rather than increase it. Instead, policymakers’ choices seem to grow more irresponsible every day.
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For more information contact Patrick Newton, press secretary, at newton@crfb.org.
