Tax Reform May be Limited to Republican Vote and Focus

Senate Majority Leader Mitch McConnell, R-Ky., during a Friday news conference, made clear why Republicans feel they must rely on the budget reconciliation process that avoids a Senate filibuster threat to rewrite the tax code. Democrats, he said, just are not willing to cooperate.“Today’s Democratic Party, seems to me, believes that tax reform is about income redistribution, how much can we get out of successful people in order to push down to those who have been less successful,” McConnell said. “That’s not about growing the economy. And so I would love to be able to do tax reform on a bipartisan basis, but I think most of the Democrats today believe tax reform is a tax hike.”While Democrats have said they are open to a tax rewrite, they have pushed for tax cuts that would benefit the middle class. Republicans have aimed for broader rate cuts at all income levels in hopes of spurring greater economic growth. “I’d love for the Democrats to be a part of that,” McConnell said. “I don’t think they look at this the same way we do, as a jobs issue, and so I am not anticipating their cooperation.”Using reconciliation would allow a tax code overhaul to pass in the Senate with a simple majority vote, which Republicans would have without any Democratic support. But that process is possible only if Congress first passes a Fiscal 2018 budget resolution that includes reconciliation instructions.Republicans on the Senate Budget Committee plan to start work on a budget resolution aimed at a tax overhaul after the recess. Meanwhile, President Trump has his sights set on a tax overhaul fight. Gary Cohn, Director of the National Economic Council, and Treasury Secretary Steven Mnuchin are the point men on taxes for the Trump administration, as the first sweeping rewrite of the tax code not seen since Ronald Reagan was in the White House.