Tax Cut? What Tax Cut?
Republicans in Congress are at the "rubber meets the road" phase of constructing their new budget, where they have to put actual numbers down on paper and add them all up. The next few weeks are going to be a dizzying frenzy of dealmaking and adjustments, as differing priorities are weighed against each other. But at the heart of their plans is a big "tax cut." I put that in scare quotes because the American taxpaying public is probably not going to see it in quite the same way as the Republicans do. The public, in fact, is going to be left wondering: "Tax cut? What tax cut? I don't see a tax cut anywhere!" Which could make the whole thing a hard sell, politically.
There may be some tax changes included which are new -- in particular the three I discussed last week (changing the way tips, Social Security payments, and overtime pay are taxed). But what I'm talking about here today is the main tax proposal from the Republicans. All the other changes are going to be small potatoes compared to extending the tax cuts that were passed during Donald Trump's first term. But please note that language: extending the tax cuts -- not creating new ones.
Due to budgetary rules and political pressure, few things are added to the federal budget in a permanent way. Most of them are added for either the next decade or for a smaller portion of that next decade. They have a "sunset" built into them, when they turn back into a pumpkin. The first Trump tax cuts will sunset this year -- if Congress does nothing, then everyone's taxes will go up next year. Few people are aware of this, though.
With Republicans back in charge of Congress and the White House, they are eager to extend these tax cuts further out into the future. Doing so will add between $4 and $5 trillion to the deficit, over 10 years. But Republicans aren't likely to get much public goodwill or credit for doing so, because if they are completely successful than the net result is going to be that nobody's taxes will change at all. There will be no "new tax cut," instead the old tax cut will merely be extended. The status quo will remain exactly the same.
This is where public perception could become a major problem for Republicans. They're going to have a big intraparty fight, struggle to put together a giant bill, and at the end of the day if they are successful, then nothing will change for people filling out their tax forms. Their taxes next year are going to be exactly the same as their taxes this year. Which is not going to get people very excited, to put it mildly.
Republicans will be left with the political sales job of: "Without our new budget, your taxes would have gone way up -- but now you'll pay exactly the same thing as you did last year!" Obviously, this is a lot tougher sell than, say: "We just lowered everyone's tax rates!" This is why I used the scare quotes on "tax cut" in that first paragraph. Republicans will be out there bragging about their gigantic "tax cut," but when any individual taxpayer goes looking for this "tax cut" they're not going to find it. Instead, they're going to find that nothing has changed for them at all.
When these tax cuts were initially passed in Trump's first term, they were the most unpopular tax cuts in history. There was no big political payoff for the Republicans, as most people (quite correctly) saw that the lion's share of the tax cuts went to the very, very wealthy, while average taxpayers got the equivalent of peanuts. So it's not like there was a groundswell of goodwill that came out of the initial passage that Republicans could look forward to riding when extending them.
Instead, Republicans are going to be stuck with: "What if they passed a tax cut and nobody noticed?" There may even be some disappointment and resentment when people do get around to filling out next year's taxes and realize that nothing has changed. "Where's that tax cut the Republicans promised me?" could be the widespread feeling, rather than thanks or gratitude.
Democrats are already pointing out that Republicans are putting together this continuation of a big payoff for the ultra-wealthy while at the same time gutting basic government services in a major way. With tens of thousands of federal workers laid off, it's going to be harder and harder for average people to interact with any government services in the future. Just today, the head of FEMA was given the boot because he had the temerity to say that he didn't think completely getting rid of FEMA was a good idea. Trump and his minions want to eliminate the program -- and in three weeks, hurricane season will begin. When the inevitable big storm comes and devastates a swath of coastline, people will expect FEMA to show up but they won't be there at all. And that's just one example.
Perhaps if the Republicans were instituting radical changes to the tax code which did indeed give millions of people an actual break on their taxes, all this austerity might be seen as a tradeoff. Trump keeps talking about how he's going to get so much money from his tariffs that he could just exempt everyone making $200,000 a year or less from paying income taxes. That would indeed be a major change that people would definitely notice -- but it's not going to be included in the budget Republicans are currently working on.
Instead, what people are going to get is the continuation of the status quo, in exchange for federal services being gutted left and right. Which is not much of a tradeoff, to the average taxpayer.
As mentioned, the next few weeks are going to be full of drama as differing factions of Republicans fight hard for their different agenda items. Whatever emerges will probably not be exactly the same as the first Trump tax cuts, as things get tweaked at the edges. But these changes will all be fairly minor, in the grand scheme of things. The main portion of the tax cuts will indeed remain the same -- or similar enough that it'll be hard to see the difference.
Which means that nobody's going to notice. Which is going to make it extremely difficult for Republicans to use it as a big talking point out on the campaign trail. They won't be met with gratitude, instead they'll be met with disbelief: "Tax cut? What tax cut?"
-- Chris Weigant
Follow Chris on Twitter: @ChrisWeigant
why wouldn't Donald and his people claim that the extension of tax cuts for billionaires is in fact a brand new, massive tax cut that will bring back jobs and make everyone's lives beautiful?
just because it happens not to actually be the case? pshaw! that's just fake news requiring alternative facts.
"Where's that tax cut the Republicans promised me?" could be the widespread feeling, rather than thanks or gratitude.
Ungrateful bastards. I mean, were they not watching the performance art of the deal today? Fat Donny's big beautiful UK deal will still include the 10% Trump Tax. He keeps his promises when he feels like it.
When I see that, that means we lose less money. Look, China was making over a trillion, $1.1 trillion, in my opinion. You know, different numbers from $500 billion to a trillion or a trillion, I think it was 1.1 trillion. And frankly, if we didn’t do business, we would have been better off. Okay, you understand that? So when you say it’s slowed down, that’s a good thing, not a bad thing. - Fat Donny displaying dementia at levels nobody has ever seen before when asked about dockworkers and truckers losing their jobs. We've never seen anything like it. Nobody ever mentions it.
If you lose your job, you don't have to pay income taxes, so you don't need a tax cut. That's a good thing, not a bad thing.
They have a "sunset" built into them, when they turn back into a pumpkin. The first Trump tax cuts will sunset this year -- if Congress does nothing, then everyone's taxes will go up next year.
Although, interestingly, the ginormous reduction in the corporate tax rate from 35% all the way down to 21% was made a permanent tax cut that will not expire, even if Congress does nothing. Not surprisingly, however, on the campaign trail, Donald Trump repeatedly promised to reduce even further the corporate tax rate down to 15% for companies that make their products in America, and I'll give you one guess who'll be the likeliest target to pay for the further reduction of corporate tax rates.
Few people are aware of this, though.
Because Trump is a pathological lying liar still maintaining -- in writing -- that he will "once again deliver the largest tax cuts in history to the American people" along with additional promises:
*
You can't make this stuff up!? Oh, hell yes, you definitely can. Needless to say, the extension of a tax cut is not the equivalent of delivering another tax cut, as CW explains in today's blog post wherein Trump might be able to deliver on those new promises, but at whose expense does this happen?
It's being widely reported all over the Internet today that Trump has proposed (again) to Mike Johnson to raise taxes on the wealthiest Americans in order to deliver on his "tax cuts" that obviously wouldn't be cuts at all if your taxes are de facto being raised via cuts to your Medicare/healthcare benefits. It seems as performative as Trump's nonexistent "tariff deal" with the UK wherein the United States Constitution grants Congress the sole authority to levy taxes, including tariffs; however, Congress has passed laws allowing the President to impose tariffs for national security reasons.
Trump invoked the 1977 International Emergency Economic Powers Act (IEEPA), which gives a POTUS powers to regulate the economy during wartime or another emergency caused by a foreign threat. This statute has never been used to raise tariffs on global imports into the United States from countries worldwide. It would be a wild stretch of the imagination for a Court to allow across-the-board import tariffs on global nations based on fentanyl use in the United States, particularly when deaths from synthetic opioids began to decline in 2023 and continued to do so in 2024. So where's the unusual and extraordinary emergency? Trump's social media posts and public statements suggesting that Canada become the 51st state hurts his claims of emergency; why would we want these alleged intentional assassins of Americans to become part of the United States? But I digress.
Good luck with that tax increase posing as a decrease, however, since there are a plethora of Republicans who have signed Grover Norquist's written "Taxpayer Protection Pledge" to never raise taxes, and it seems likely to be a bill dead on arrival in the Senate even if it could ever passed out of the House.
nypoet22
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Exactly!
John From Censornati
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Ungrateful bastards. I mean, were they not watching the performance art of the deal today?
Exactly! That could obviously only be performance art because if the UK was such an "unusual threat" that posed an "extraordinary emergency" to the United States that the POTUS had to unilaterally take steps to tax the ever-loving shit out of them via tariffs that get passed onto American taxpayers, what are those American-killing assassins doing cavorting and laughing in the Oval anywhere near the President of the United States?
You're making too much sense, John (not to be confused with the other John). :)
The claim that Republicans’ extension of Trump’s first-term tax cuts will yield no political benefit because it merely maintains the status quo is completely misguided and has no factual basis in the objective reality of the here and now...
The 2017 Tax Cuts and Jobs Act, set to sunset in 2025, slashed individual and corporate rates, boosting economic growth and saving the average taxpayer thousands annually—$2,000 for a family of four, per the IRS. This is all documented FACT..
Extending these cuts, as Republicans plan, prevents a massive tax hike that would hit 60% of Americans, per the Tax Foundation, adding $3,000-$4,000 to middle-class tax bills in 2026.
This isn’t “nothing”. It’s shielding voters from financial pain, a fact Democrats downplay or flat out IGNORE while hyping a skewed ideologically based narrative of “ultra-wealthy” benefits.
The budget’s $4-$5 trillion deficit impact over a decade is offset by PRESIDENT Trump’s tariff revenue, projected at $90 billion annually, and economic growth from deregulation.
Since ya'all like POLLS so much, the polls, like a March 2025 Morning Consult survey, show 53% approve of Trump’s economic policies, including tariffs, which means that the media claims of unpopularity is a complete and utter lie.
New tax breaks, exempting tips, Social Security, and overtime pay from being taxed, further sweetens the deal for workers, directly impacting millions.
Hysterical woke progressive Democrats’ critique of “gutted” services ignores FEMA’s inefficiencies and Musk’s efficiency reforms, which 62% of voters support per a Rasmussen poll. There's one of those pesky INCONVENIENT polls that woke progressive Democrats ignore..
The GOP's fight to preserve these cuts, against woke progressive Democrat obstructionism, will resonate as a tangible win, not a silent status quo.
In other words, the vast majority of the American people are behind PRESIDENT Trump on each and every one of these actions..
It's another one of those 80/20 issues where PRESIDENT Trump and the American people are on the 80% side of the issue and woke progressive Trump/America hating woke progressive Democrats are on the 20% side of the issue..
why wouldn't Donald and his people claim that the extension of tax cuts for billionaires is in fact a brand new, massive tax cut that will bring back jobs and make everyone's lives beautiful?
just because it happens not to actually be the case? pshaw! that's just fake news requiring alternative facts.
The idea that President Trump falsely touts extending his 2017 tax cuts as a “brand new, massive tax cut” for billionaires is ludicrous and completely without factual merit.
The Tax Cuts and Jobs Act saved middle-class families $2,000 annually, per IRS data, and spurred job growth, with 3.2 million jobs added by 2019.
Extending these cuts prevents a $3,000-$4,000 tax hike for 60% of Americans in 2026. This is documented FACT per THE TAX FOUNDATION. PRESIDENT Trump’s tariff strategy, yielding $90 billion yearly, offsets the $4-$5 trillion deficit impact.
PRESIDENT Trump's new exemptions, tips, Social Security, overtime pay, DIRECTELY benefit workers.
Far from “fake news,” PRESIDENT Trump’s policies deliver real economic gains, not just for the wealthy but for ALL Americans..
It's another 80/20 issue where 80% of Americans support PRESIDENT Trump and woke progressive Democrats are on the 20% of that issue..
As they are on many MANY issues that the American voter cares about..
You DO recall the results of the 2024 election, right???
The election where PRESIDENT Trump won the POPULAR VOTE by MILLIONS and MILLIONS of votes..
You DO remember that, right??
@m,
i suggest you re-read my post; you're having some comprehension issues.
JL
Trump’s tariff strategy, yielding $90 billion yearly, offsets the $4-$5 trillion deficit impact.
that's hilarious.
March 2025 Morning Consult survey
March? Dude, it's May...
Let's see these 80/20 polls. Or would that show you for a fraud? Can't back up the bullshit coming out of your AI spewage?