The Left has got to stop using the Sunset argument to attack the new Tax bill. There are plenty of areas to attack regarding the bill but this one is a losing argument. I hear democratic congressmen using this talking point in every interview and all it takes is asking them the question, "Would you vote to repeal the individual tax cuts in 7 years?" Of course they aren't going to say yes. We know that Republicans aren't going to repeal them and I seriously doubt that dems would either. It would be political suicide.
For those of you who don't know what the sunset argument is... It is the talking point that the Corporate cuts are permanent and the individual tax cuts are temporary, up for a renewal vote after 7 years. Dems are playing the scenario that after 7 years, if the tax cuts aren't renewed by congress, then everybody's taxes will go up. I'm saying right now that is not realistic, nobody is not going to vote to renew, it is a losing argument. Move on to the next one!
I'm asking the question then, why didn't they make them permanent as well?
Here are three big reasons the individual tax cuts would be temporary.
1. To get the bill to qualify with Senate rules
Republicans are attempting to pass the bill, the Tax Cuts and Jobs Act (TCJA), through the
process known as budget reconciliation. The process allows Republicans to avoid a Democratic filibuster and pass the bill on a party-line vote, but it comes with strings attached.
One of the rules included in the reconciliation process is known as the Byrd rule. A provision within that rule stipulates that any bill going through reconciliation cannot
add to the federal deficit outside of 10 years.
Sen. Orrin Hatch, chair of the Senate Finance Committee and author of the bill, has
admitted that the original version of the Senate's TCJA did not meet such a requirement. Making the individual cuts temporary could allow the bill to meet those requirements.
2. To try and get companies to invest more
So: Why let the individual tax cuts expire and not the corporate tax cuts? Allowing the corporate tax cuts to fade would save roughly the same, if not slightly more money, against the debt, analyses show.
But a temporary tax cut for businesses
could change the way they do business.
The policy rationale is that if a company believes the tax relief would be temporary, it would make short-term investments to maximize benefits within the window while eschewing long-term investment that could reap benefits in the longer-term.
In a study on a temporary corporate tax cut versus a permanent tax cut,
the Tax Foundation found that short-term investments under a temporary cut would considerably mute the economic boost of cutting taxes on businesses.
Since the boost to economic growth and investment has been a key selling point for Republican leaders, anything that would dampen that investment would undermine the GOP's central argument.
Hatch made a similar argument
in a statement.
"Additionally, the modified mark creates more permanence in our tax system so that American job creators can invest in the long term, grow their business and create new jobs," said Hatch.
3. To try to kick the can to a future Congress
Finally, there's a fairly simple political argument that Republicans can make to defend the sunset of the individual tax cuts: Congress would never let it happen.
Hatch and the GOP are banking that a future Congress would not allow the tax breaks to go away when they come up in 2025 — effectively enacting a tax increase on millions of Americans — but pass a bill to extend these cuts.
That would follow a similar playbook to tax cuts passed under President George W. Bush. Because of the same concerns about reconciliation, that legislation sunset individual tax cuts. In 2013, however,
Congress extended those cuts with the American Taxpayer Relief Act, rather than letting people's tax bills jump. The cuts for certain incomes were allowed to expire.
Here's why Senate Republicans are making tax cuts for average Americans temporary
