President Donald Trump and some top GOP leaders in the House pledged on Wednesday to pursue more tax cuts for middle-class Americans. In an unusual joint press statement, the President said that this would likely be done in 2019. This is a much slower timeline compared to what he had promised earlier. Trump had said that the plan was already in the works. Standing side by side with Rep. Kevin Brady (R-Tex), Chairman of the House Ways and Means Committee, he said that they were looking at a possible 10% cut.
Trump had promised before a 10% cut but at a quicker timeline. Congress is now in recess until after the midterms and any possible move will have to wait until then. In addition to this, there are still some aspects of the tax cuts that aren’t ready. One of the key challenges that the White House is grappling with is how to structure the cuts so that they don’t increase the already massive deficit. This would logically mean that the government will have to raise money elsewhere or cut spending on some programs.
The GOP already passed a massive tax cut last year. However, critics think that the cuts have largely benefited corporations and high net worth individuals. The GOP tax cuts will also add up to a $1 trillion to the federal deficit. This has made the legislation quite unpopular among many Americans. The thinking behind the tax bill was actually very simple. Trump and his aides hoped that by offering corporations a tax break, the money saved would be used to invest in the US and increase employee wages. But this hasn’t happened yet. In fact, many corporations have swiftly increased stock buybacks.
The joint statement noted that the Trump administration is confident that the new tax cuts for middle-class Americans will be in place early next year just a few weeks after the new Congress is sworn in. However, there’s still one hurdle to overcome for now. The GOP is battling to retain control of the House in the midterms. If Democrats win enough seats to flip it, then it’s very likely that the tax plan will face massive challenges before it’s confirmed.
Over the two years of Trump’s administration, partisan politics in Congress have overshadowed many important issues including the confirmation of Supreme Court Judge Brett Kavanaugh. This isn’t expected to change if the Democrats win the House. The timing of this announcement is also very interesting. It comes just a few days before the midterms. Whether this is a last minute attempt by the GOP to sway voters is still unclear. But in a tough race like the one slated for November 6th, anything that scores political points is on the table. The Trump administration hasn’t leveraged that much on the GOP tax cuts passed last year simply because most of middle-class Americans didn’t feel its effects at all.