WASHINGTON (AP) — President Donald Trump has touted his tax overhaul as a once-in-a-generation opportunity. Yet the plan Senate Republicans have embraced could force lawmakers to rewrite the tax code repeatedly for years to come.
The main reason is that some of its key planks are set to expire, thereby forcing tough choices on a future Congress about whether to renew them.
The tax cuts for individuals and families? They’d vanish after eight years.
The breaks for companies to fully expense new equipment? Gone by 2023.
Tax credits for employers that offer medical and family leave? Not after 2020.
A reduced excise tax for craft brewers and distillers? No more after 2020.
The whole setup means lawmakers will ultimately face pressure to renew these tax cuts. Letting them lapse could ignite a public backlash because people’s taxes would shoot up. When Congress faced a similar predicament in 2013, economists warned that tax hikes might tip the economy into a recession. In the end, most of the tax cuts were preserved.
Yet extending the tax cuts could require slashing spending on popular programs, possibly including Medicare and Social Security. Or it could mean letting the deficit climb much faster than Trump and lawmakers have promised, which brings its own economic risks.
Republican lawmakers have tried to assure voters that tax cuts for the middle class will be protected. But the tax overhaul creates a perilous series of votes for lawmakers in coming years.
“‘Governing from crisis to crisis is exactly the way to put it,” says Steve Bell, a senior adviser at the Bipartisan Policy Center and a former staff director at the Senate Budget Committee.