In New Response to Lawmakers, Joint Committee on Taxation Reveals GOP Use of “Magic Math” Would Be Unprecedented

In New Response to Lawmakers, Joint Committee on Taxation Reveals GOP Use of “Magic Math” Would Be Unprecedented
Republicans want to use “magic math” to pay for billionaire tax cuts and falsely claim no cost to American taxpayers
Text of Response Letter (PDF)
Washington, D.C. –In a new response to a recent letter sent by U.S. Senators Elizabeth Warren (D-Mass.), Catherine Cortez Masto (D-Nev.), Mark R. Warner (D-Va.), Michael Bennet (D-Colo.), and Peter Welch (D-Vt.), the nonpartisan Joint Committee on Taxation (JCT) revealed the unprecedented nature of Republicans’ proposed “magic math” to pay for billionaire tax cuts and falsely claim no cost to American taxpayers.
On February 19, the lawmakers sent aletterto JCT, pressing for answers on the scoring methods used for tax legislation ahead of the expiration of many of the tax provisions contained in President Trump’s 2017Tax Cuts and Jobs Act(TCJA).
In its new response, JCT confirmed:
In 2017, Congressional Republicans set many TCJA provisions to expire this year in an attempt to keep the price tag of the proposed tax cuts below $1.5 trillion. According to the Congressional Budget Office (CBO), extending these tax cuts for the next ten years would cost trillions and would disproportionately benefit the wealthiest Americans.
Still, some Senate Republicans claim that the cost of extending the TCJA is $0. To accurately calculate the cost of these tax cut extensions, Congress needs a baseline to measure changes against. By law, that baseline has been the “current law,” which assumes that expiring provisions will expire on schedule and therefore that any extension would cost money. Senate Republicans have suggested that this year’s tax bill should be evaluated based on a “current policy baseline,” which assumes that expiring provisions will not expire and that any extensions of temporary provisions cost nothing.
At a hearing of the Senate Finance Committee on Thursday, March 6, Senator WarrenquestionedDr. Michael Faulkender, President Trump’s nominee for Deputy Secretary of the Treasury, on Republicans’ “magic math” for their plans to cut taxes for the ultra-wealthy. When pressed by Senator Warren on whether this gimmick actually produces additional revenue, Dr. Faulkender admitted: "I can't imagine that it would.”
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