Tax Cuts & Jobs Act: Did the GOP Open THE Door To a Carbon Tax

Diggin' that double speak title- "Tax Cuts and Jobs Act" I suspect this act may be the set up for the carbon tax....Trump did just sign this Tax Bill into Law

The U.S. Congress this week passed the tax bill along party line, with no Democrats voting for it.At the signing ceremony, Trump called it "a bill for the middle class and a bill for jobs," adding that "corporations are literally going wild."The tax bill, the sweeping rewrite of U.S. tax law since 1986, would cut the corporate income tax rate to 21 percent from the current 35 percent and lower individual income rates.The tax bill is expected to add 1.46 trillion U.S. dollars to federal deficits over the next 10 years, according to estimates by the nonpartisan Joint Committee on Taxation.

This tax bill will NOT add to federal deficits in the amounts claimed if it opens the door for a carbon tax!Did The GOP Just Open The Door To A Carbon Tax In 2025?

Supporters of the Tax Cuts and Jobs Act like to describe it as a once-in-a-generation tax overhaul. It is arguably true that it is the most wide ranging tax bill in three decades. But key elements of the TCJA all but guarantee that Congress will be revisiting the tax code again in a few short years. The TCJA may be sweeping but it also may have a short shelf-life.

The first problem is its highly partisan nature. Republicans made no effort to craft a bipartisan bill and no Democrat voted for the measure at any step along the way. Already, liberals are vowing to overturn key business provisions should Democrats regain control of Congress in 2019. On Sunday, even before the TCJA passed, Sen. Bernie Sanders (I-VT) was  predicting a future Congress would reverse corporate tax cuts.

Highly partisan? Xinhua "The U.S. Congress this week passed the tax bill along party line, with no Democrats voting for it."

As long as President Trump remains in office, Democratic efforts to “repeal and replace” the TCJA likely will fail. But, copying the GOP playbook after passage of the Affordable Care Act, Democrats aim to use the tax bill as a political cudgel to try to regain control of government and, should they get the chance, rewrite the tax laws yet again.

A legislative Mulligan

 A mulligan is a second chance to perform an action, usually after the first chance went wrong through bad luck or a blunder.

But unlike the ACA, the TCJA explicitly opens the door to a legislative Mulligan. Because it repeals nearly all of its individual tax provisions by 2026, the new law not only encourages Congress to revisit tax policy within eight years, it requires it.Republicans have described this as a binary choice for a future Congress. They say lawmakers must either extend the individual tax provisions or take the blame for the demise of what they believe will be popular tax changes, such as individual income tax rate reductions and a big increase in the standard deduction.

But Congress will have many more options than that. Of course, we have no idea who will control government in 2025. We do know that Donald Trump will no longer be president, even if he is reelected in 2020. And control of Congress is at best uncertain. Among other things, a major congressional redistricting may occur after the 2020 Census.

Punting on pass-throughs

As a small thought experiment, imagine that Democrats control the White House and at least one chamber on Capitol Hill in 2025. And imagine the debt has increased to about 90 percent of Gross Domestic Product, a fair assumption after taking into account the lost revenue from the TCJAWith the looming expiration of nearly the entire individual tax code, this future Congress will have an open door to rewrite the tax law in any way it wants. It could, for instance, keep the TCJA’s individual income tax cuts but allow key tax increases, such as curbs on the state and local tax deduction, to expire.

Congress could help pay for those changes by eliminating, or at least rolling back, the TCJA’s special tax treatment for pass-through businesses such as partnerships. Even the GOP-controlled Kansas legislature did just that earlier this year—over the objections of one of the most aggressive anti-tax governors in the country

A carbon tax?Congress could also, in a new-found concern for the growing federal debt, undo some of the TCJA’s corporate tax rate cuts. It could reinvigorate the estate tax. Or, in a burst of ambition, it could enact a Value-Added Tax or a carbon tax. Imagine Democrats presenting US businesses and their congressional allies with a choice—an across-the-board corporate tax rate hike or some form of consumption tax. Are you confident predicting the outcome? I’m not. Tax laws often have unintended consequences. This could be a doozy.

In policy terms, eight years is the blink of an eye. And while the TCJA is a big, ambitious change to the tax code, it may also be an historically short-lived one.

I'd say the plan for a carbon tax is being initiated. It won't fly under Trump. But once he's gone... It's carbon tax time- a big, big tax grab. As I reported in June of this year Trump merely kicked  the political hot potato down the road- and the carbon tax grab is being prepared for.Perhaps we'll be seeing Hillary Clinton's reappearance?Trump Reality TV: Paris Climate Exit 4 years Away- Meaningless Withdrawal Claims

  The good news: he can’t just pull the plug. Under the terms of the agreement, it’ll take four full years to officially exit, which means the next President can put a stop to this nonsense in 2020.

From earlier today

Attacking Kirkuk: Kurdish Militant Group Re-emerges in Iraq

And two great interviews from this past week