Healthcare Bill Collapse Means Pivot to Tax Overhaul
The pulling of the American Health Care Act Friday and subsequent announcements from the White House and Congressional Republicans indicate tax overhaul will become a focus of the government in coming months.
The news comes after a bill to repeal and replace the Affordable Care Act was pulled around 3:30 p.m. Friday after House Speaker Paul Ryan, R-Wisc. met with President Donald Trump to explain that Republicans did not have enough votes to pass the bill, CNN reports.
Speaking on the matter at a press conference Friday afternoon, Ryan said pulling the healthcare bill "makes tax reform difficult but not impossible."
Ryan said “Obamacare taxes" will "stay with Obamacare," but that the government was “going to fix the rest of the tax code.”
The president also affirmed his administration's focus on tax reform. “We’re going to go for tax reform,” Trump said at a separate press conference, indicating a pivot from the administration's focus on healthcare.
Earlier in the day, the new head of the Treasury Department had already signaled the White House was set on a major tax code overhaul but that it may not get implemented by August, Bloomberg writes.
The White House will reduce both personal and corporate taxes, U.S. Treasury Secretary Steven Mnuchin said at an event put on by media firm Axios, according to the news service. However, Mnuchin was more hesitant about recommitting to getting the work done by the time Congress goes on recess in August as he had previously projected, although he said he’s still optimistic, Bloomberg writes.
One issue is that House GOP leaders have proposed cutting the corporate tax rate from 35% to 20%, but Trump spoke of a 15% corporate tax rate during his election campaign, according to the publication. Mnuchin said it was too early to predict what Trump’s eventual tax proposal would be, Bloomberg writes.
Ryan has previously said Republicans were sticking to the August target, according to the publication. Meanwhile, Trump is reportedly still working on the tax plan he promised to roll out in two or three weeks in February, White House budget director Mick Mulvaney said on ABC’s TV show “Good Morning America” Friday, adding that the White House will “drive the debate” on it, Bloomberg writes.
Before the American Health Care Act vote was pulled Friday, several Republicans had already questioned whether the tax cuts could be pushed through if their health bill didn’t get enough votes, Bloomberg writes.
Mnuchin, however, said tax cuts are “a lot simpler in some ways” than a healthcare overhaul, according to the publication. Nonetheless, he raised concern over a central provision in Ryan’s tax reform proposal to tax imports by U.S. firms and exempt their exports, calling it a “complicated issue” that needs further review, Bloomberg writes.