Unpaid-For Tax Cuts Would Be Irresponsible and Hypocritical
According to press reports, the House majority is currently considering a tax cut package that would extend or reverse several business provisions from the 2017 tax cuts, in addition to potentially enacting further tax cuts. In particular, the package would reinstate expensing of research and experimentation costs that ended in 2022, restore 100 percent bonus depreciation for equipment that is currently phasing out, and restore the looser net interest deduction limit in effect prior to 2022, among other possible tax cuts. Absent offsets, these tax cuts could add over $500 billion to the debt over the next decade.
The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:
It’s outrageous that Congress would consider adding more than half a trillion dollars to the debt, having spent the last several months highlighting how bad our fiscal situation is.
The House was right to pass deficit reduction this week and call on the President to enter into serious budget negotiations. Following that call with budget-busting tax cuts would totally undermine that effort. It is brazenly hypocritical to warn about the consequences of high deficits and debt one day while promoting unpaid-for tax cuts the next. In fact, it’s outright outrageous.
Now is not the time for new tax cuts or new spending, especially without appropriate offsets. Lawmakers should be focused on an agenda to lower deficits, help the Fed fight inflation, and put the debt on a more sustainable path.
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