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News & Politics News & Politics

Republicans pass tax breaks, but don’t pay for them

Posted by on May. 4, 2014 at 5:29 AM
  • 8 Replies

Republicans pass tax breaks, but don’t pay for them


Washington (CNN) – Republicans want to cut the deficit. And Republicans want to cut taxes. Tuesday, those two sweeping goals collided as a GOP-controlled House committee voted to advance hundreds of billions in tax cuts at the cost of adding those billions to the deficit.

The House Ways and Means Committee voted almost entirely along party lines to make six tax breaks permanent at a cost of $310 billion over the next 10 years.


The top Democrat on the committee pounced.

“To say that Republican action today is hypocritical is a serious understatement,” Rep. Sandy Levin of Michigan said. “This approach today of Republicans flies smack in the face of fiscal responsibility.”

But the committee’s Republican chairman, Dave Camp, also of Michigan, did not blink. He responded that the tax breaks have been passed year after year without any offsets.

“This bill has been extended, unpaid for, probably 30 times,” Camp said of a research tax credit. “I think it’s important we extend this … supporting permanency, not a temporary extension.”

Team Camp also points to another argument: They believe the jobs that come from tax breaks are worth adding some red ink to the deficit.

“These are things that people feel are extremely worth adding to the economy,” said Camp spokeswoman Sarah Swinehart.

What’s $310 billion get you?

These six so-called “tax extenders” that the Ways and Means Committee approved Tuesday were plucked from a larger group of 55 tax breaks that expired at the end of 2013 and have been waiting for congressional renewal.

Among those passed Tuesday were three biggies: the research and experimentation deduction, the credit that helps small businesses with major equipment costs, and the break for businesses earning rent and interest overseas.

Camp was correct. In recent years, Congress has extended the breaks year after year without offsetting their costs. But in the 90s, most of them were offset.

Why the flashpoint now?

Democrats are particularly pressing the issue now because they see a conflict between the Republican demands that spending, especially on Democratic priorities like unemployment benefits, be offset while the GOP allows their own priority – tax cuts – to add to the deficit.

“It’s a clear double standard, particularly when you hold up unemployment,” said Chuck Marr, director of tax policy at the left-leaning Center on Budget and Policy Priorities.

But Democrats also have exceptions to pay-for pushes, notably, many Democrats believe that unemployment benefits are emergency spending and do not need to be offset.

When asked if that is a double standard from the left, Marr said no.

“Unemployment insurance is a temporary, countercyclical move,” he replied. “What Republicans are doing here is pushing for something permanent and unpaid for.”

GOP chooses tax cuts at expense of deficit

Republicans insist their decision to choose tax cuts over trimming the deficit is nothing new.

“(Chairman Camp) has the position that extensions of current policy and tax cuts don’t have to be paid for,” said Swinehart. “Pay-fors are for spending. New spending. That’s his position.”

Yet, in Camp’s recent sweeping tax reform proposal, he did pay for all the tax cuts he extended. He did that largely by repealing other tax cuts. But that proposal is not going anywhere.

Camp insists that’s not a contradiction. His office argues that paying for tax breaks is only possible in a comprehensive revision of the tax system, not when tax breaks are taken one by one as the House is preparing to do now.

The result: On Tuesday, Republicans on the Ways and Means Committee choose their anti-tax crusade over their image as deficit hawks.

Next, all Republicans in the House will face a similar choice.

Multiple GOP sources tell CNN they expect all six tax credit bills to get votes on the House floor and that leadership is still working out the exact timing.

http://politicalticker.blogs.cnn.com/2014/04/29/republicans-pass-tax-breaks-but-dont-pay-for-them/

by on May. 4, 2014 at 5:29 AM
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Replies (1-8):
Schauseil
by Bronze Member on May. 4, 2014 at 5:46 PM
This is rediculous. All spending, regardless of what form it takes, has to be offset by income. That's just simple math. It's a very simple concept. This is just pure stupidity on both sides.
29again
by Gold Member on May. 4, 2014 at 6:22 PM
2 moms liked this

And of course, the dems know a double standard when they see one, even if it isn't one.  They are the master of that particular art.



How the hell do you pay for a tax cut?  The way our government regards money and taxes is just so backwards.  No wonder this country is falling on its knees.  Our leadership has no clue.

jobseeker
by Bronze Member on May. 4, 2014 at 8:48 PM
3 moms liked this

 and dems pass spending bills with out paying for them....

numbr1wmn
by Nikki on May. 5, 2014 at 8:31 AM

The OP proves that she doesn't have a clue here.

bluerooffarm
by Silver Member on May. 5, 2014 at 8:45 AM
1 mom liked this

This one makes my head hurt.  So Dems need to find a way to pay for their increased expenditures.  I can see that.  And Repubs need to find expenditure cuts so that they can decrease the revenue.  Okay, I think i got it.  Using the wording that the Republicans need to "pay for" their tax cuts seems like a strange way of saying that if you want to cut revenue, you need to cut expenditures.  Maybe the way our Gov't is viewing money is a bit off.

lizzielouaf
by Bronze Member on May. 5, 2014 at 8:58 AM
I still can not fathom why people (citizens) continue to argue one side is better than the other.
denise3680
by Gold Member on May. 5, 2014 at 9:03 AM

we do not need tax cuts we need tax reform.

Kate_Momof3
by Platinum Member on May. 5, 2014 at 9:24 AM

Amen. DC is a clusterfuck.

All three of those tax cuts can be exploited and manipulated by large corporations. By the same token, more money in the  hands of unemployed workers means they can still buy stuff and that helps the economy vis a vis large corporations...

SO

This is basically a tug of war over who is going to make corporations happy first.


Quoting lizzielouaf: I still can not fathom why people (citizens) continue to argue one side is better than the other.


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