Conservatives Slam Tax Hike Trigger


Posted by Americans for Tax Reform on Thursday, November 30th, 2017, 4:25 PM PERMALINK

(This list is being continuously updated)

Americans for Tax Reform: “A self-fulfilling threat to kill jobs.”

“The key to pro-growth tax reform is permanence and certainty. This encourages job-creating investment. No one invests in response to ‘maybe.’ A trigger that threatens tax hikes is a self-fulfilling threat to kill jobs.” –ATR president Grover Norquist

Americans for Prosperity: “Such a provision would add unnecessary complexity and uncertainty into the tax code, stifle the economy and generate less revenue.”

“It’s disappointing to see some in the Senate considering a provision that would automatically raise taxes as part of the Tax Cuts and Jobs Act. Including a trigger mechanism in tax reform is antithetical to the principles of the unified tax framework. Such a provision would add unnecessary complexity and uncertainty into the tax code, stifle the economy and generate less revenue. Simplifying the tax code and keeping rates low, flat and fair is the best way to spur economic growth. Champions of pro-growth, comprehensive tax reform should oppose any attempt to include this harmful provision for the sake of the hardworking Americans depending on Congress to enact reforms that will deliver real tax relief and economic prosperity.” -- AFP Chief Government Affairs Officer Brent Gardner

Tim Phillips, president of Americans for Prosperity: “A nutty idea” with “devastating economic consequences.”

American Conservative Union Foundation: "Any autmotically-triggered tax increase is bad policy and bad for the economy"

"We are very disappointed about the potential of a 'trigger' being included in a final tax bill. Any automatically-triggered tax increase is bad policy and bad for the economy. Conservatives cannot support this tax increase. Even President Obama supported automatic spending cuts rather than triggering future tax increases. Future deficits should be resolved with spending cuts before tax increases are ever contemplated. 

The revenue trigger imposes tax increases that would go into effect if the bill's tax cuts result in raising the deficit. The ACUF has been consistent in our message that the key to strong tax reform lies in ensuring that American taxpayers are not burdened with higher tax rates and in legislation that helps stimulate and revitalize the economy. The provision would add a layer of complexity to the tax code that would effectively hinder job growth and undercut efforts to safeguard taxpayers across the country. We urge Congress to remain steadfast in their commitment to the best interests of American taxpayers, American businesses, and the American Dream.

National Taxpayers Union: “This is a seriously misguided approach that will ultimately undermine pro-growth tax reform legislation.”

“By injecting uncertainty into the tax code, a trigger mechanism would certainly stymie economic growth, thereby resulting in a likely tax increase. This is a seriously misguided approach that will ultimately undermine pro-growth tax reform legislation. We have worked alongside policymakers for decades to preserve the nation’s fiscal health, and applaud efforts to decrease deficits by controlling spending. But expanding economic opportunities is also key to addressing the programs driving those deficits, making a trigger a self-defeating strategy even for those concerned about budget shortfalls. The nation’s fiscal future will be uncertain as long as the economic barriers created by the current tax code remain; a trigger only makes those barriers more difficult to tear down, especially for Americans seeking to get ahead. We urge the Senate to reject a tax hike trigger as it works to refine the tax reform bill and enact it into law.” – NTU President Pete Sepp

FreedomWorks: “It's frustrating that some Republican senators, who pride themselves as so-called 'deficit hawks,' demanded tax increases if growth targets weren't met, rather than spending cuts.”

“Congress has a spending problem, not a revenue problem. It's frustrating that some Republican senators, who pride themselves as so-called 'deficit hawks,' demanded tax increases if growth targets weren't met, rather than spending cuts. These same senators regularly vote for more spending, making them part of the problem.

“If we can tie tax reform to spending cuts if we don’t meet revenue projections – fantastic. We should have spending cuts anyway. And the purpose of tax cuts is to create a more vibrant economy, not to take more dollars from American citizens.” -- FreedomWorks Vice President of Legislative Affairs Jason Pye

Wall Street Journal editorial board: “A trigger is a bad idea on the policy merits.”

Club for Growth: “The idea of a ‘tax hike trigger’ should be rejected on its merits.”

“The idea of a ‘tax hike trigger’ should be rejected on its merits,” stated Club for Growth President David McIntosh.

“Any senator who understands basic business principles and truly cares about the deficit should understand that this trigger is an automatic tax increase and will actually harm economic growth. It will have harmful impacts on American businesses and undermine any economic growth potential in this tax reform bill because businesses will not invest due to the possibility of a higher tax rate.  

“What Senators Lankford and Corker are saying here is that if the deficit gets too large, then they want to tax people more. Here’s an idea. How about cutting spending? Just yesterday Senator Lankford issued 100 wasteful examples of federal spending. But instead of cutting the programs, ironically, Senator Lankford would allow wasteful measures like them to continue to receive funding – through his automatic tax increases no less! 

“If they’re truly worried about the deficit and they want to establish a trigger, then they should limit the size of government. A spending cut trigger would be a far better idea.” – Club for Growth President David McIntosh

U.S. Chamber of Commerce: “Impractical, unreasonable, and unnecessary.”

“While one can appreciate the intentions, the fact remains a fiscal trigger is a terrible idea.

The flaws of the fiscal trigger, whereby taxes would rise if revenues disappointed are many, but let us focus on the biggest. The most obvious is, against what metric would a shortfall be counted? Are the trigger’s proponents willing to embrace a particular estimate for the additional growth and associated revenue gains? Without such a dynamic revenue estimate, the trigger is an illusion.” – J.D. Foster, Senior Vice President, Economic Policy Division, and Chief Economist

Small Business & Entrepreneurship Council: Tax hike trigger is an “awful idea”

“Yes, it’s an impractical idea. It’s an awful idea.  A ‘trigger’ takes the growth out of pro-growth tax reform. Entrepreneurs want predictability along with reforms that promote investment and sustainable economic growth. The threat of a trigger will harm investment in small businesses and startups and reboot the uncertain economic and policy environment that we are working furiously to get out of.  A trigger undermines many of the reasons for doing tax reform in the first place, which is to make our tax system more competitive and spur strong investment and economic growth. Can we just move on with positive, pro-growth tax reform and ditch the trigger idea?” -- Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan

Campaign for Liberty: “The main problem with the trigger is a moral one. The idea that Congress can give and take away tax cuts is rooted in the idea that all property belongs to the state and so any money not taxed is a gift from government that government can take away at will.”

“Finally, one proposal on the table is to attach a ‘trigger’ to the tax that would automatically raise taxes if the bill’s tax cuts raised the deficit. Tax cuts that could be taken away at any time obviously hinders the incentive to invest in new businesses and thus limits the tax cuts pro-growth effects, making an increase in the deficit a self-fulfilling prophecy.

The prospect of automatic tax increases also removes any incentive for Congress to stop spending. However, the main problem with the trigger is a moral one. The idea that Congress can give and take away tax cuts is rooted in the idea that all property belongs to the state and so any money not taxed is a gift from government that government can take away at will. This is the exact opposite of the truth as stated in the Declaration of Independence.” – Norm Singleton, President of Ron Paul’s Campaign for Liberty

ALEC Chief Economist Jonathan Williams: “The proposed federal tax increase triggers get the idea completely backwards.”

“The proposed federal tax increase triggers get the idea completely backwards. Tax triggers have been effectively used to bring additional tax relief for taxpayers after healthy revenue growth. The highly successful North Carolina tax reform provides great evidence showing how tax triggers should be used. It's disappointing to see so called fiscal conservatives advocate for tax triggers that would automatically raise tax rates if economic growth is not realized. Our tax code doesn't need any additional uncertainty. A much better approach would force government to re-prioritize spending decisions.” – Jonathan Williams, ALEC Chief Economist and Vice President, Center for State Fiscal Reform

Tax Foundation senior analyst Scott Greenberg: “The trigger would become a self-fulfilling prophesy.”

Heritage Foundation economist Romina Boccia: “Including a potential tax increase through a trigger or by any other means creates uncertainty, which will lower the overall economic growth we can expect to see from the tax plan.”

Heritage Foundation budget analyst Adam Michel: "Holding pro-growth tax reform hostage over the near-tern deficit impact is counterproductive and unwittingly undermines the very growth that tax reform promises."

Freedom Partners: “The very threat of looming tax hikes could be a drag on growth all by itself.”

“It’s hard to imagine a more counterproductive policy than imposing automatic tax hikes on an economy that isn’t growing as fast as expected. Furthermore, the very threat of looming tax hikes could be a drag on growth all by itself. If revenue is a concern, there is plenty of corporate welfare and wasteful spending left to cut. History has shown that tax cuts consistently lead to increases in federal revenue as a result of robust economic growth. We’re hopeful Congress won’t undermine the many positive reforms in the Senate bill with this self-destructive policy.” -- Freedom Partners Executive Vice President Nathan Nascimento

Steve Moore: “destructive and a threat to economic growth.”

“So-called ‘triggers’ for future tax HIKES are destructive & a threat to economic growth. #TaxBill should reject. We need competetive rates & predictability.” – Steve Moore, Heritage Foundation Economist, FreedomWorks Senior Economic Contributor

Sen. Pat Toomey: Tax hike trigger could “have a self-fulfilling effect”

Rep. Jeb Hensarling (R-Texas): “I can’t think of a worse way to tank the economy than to raise taxes.”

Sen. Rand Paul: "I'm not very excited about having any automatic raises in taxes.

Rep. Trent Franks (R-Ariz.): Tax hike trigger is “a special level of insanity”​

Sen. Dean Heller (R-Nev.): “I do not support triggers.”

Rep. Mark Sanford (R-S.C.): “If businesses or individuals have no ability to plan on a rate, it makes an investment decision, for instance, very, very difficult.”​

Dan Mitchell: "Tax hike triggers are bad for growth."

Cato Institute’s Ryan Bourne: A tax hike trigger “dampens the pro-growth effects of the tax plan, and risks lower-than-expected revenues becoming a self-fulfilling prophecy.” 

Deroy Murdock: "Disarming this absurd, self-defeating tax-hike trigger is the only form of gun control that Republicans should support."

"Why on Earth are some Republicans crafting a tax hike trigger? God created Democrats, not Republicans, to hike taxes. The GOP Congress seems determined to turn President Trump's simple tax cut and simplification proposal into something as twisted and tangled as an osprey nest. Republicans should have faith in what John F. Kennedy and Ronald Reagan understood: lower, simpler, flatter taxes trigger economic growth, which raises federal revenues. Spending restraint, not tax-hike threats,will help curb deficits. Disarming this absurd, self-defeating tax-hike trigger is the only form of gun control that Republicans should support" -- Deroy Murdock, Fox News contributor and co-founder KeepCalmAndCutTaxes.com

Mercatus Center Senior Research Fellow Veronique de Rugy: "There is so much wrong with this proposal that it is hard to know where to start." 

Taxpayers Protection Alliance president David Williams: “We believe a tax hike trigger hinders the economy’s growth. Spending cuts must go hand-in-hand with tax cuts, as to not overthrow the deficit.”

Mattie Duppler Springer, senior fellow for fiscal policy at National Taxpayers Union: “The uncertainty this would interject into the economy would diminish the growth impact of the corporate income tax cut and deprive workers of the wage growth they so sorely need.”

Rep. Diane Black (R-Tenn.), chairman of the House Budget Committee: “I’m not as exactly on board as what the Senate might be on that. I actually believe the better trigger mechanism here is to cut spending.”

Deneen Borelli at Conservative Review: “Bad idea.”

WSJ editorial page assistant editor James Freeman: “Finally we have a consensus in the economic community on the right and the left, everyone agrees its asinine to put in automatic tax hikes.”

Economists are also strongly opposed to the tax-hike trigger:

Dan Clifton:  "Our read of the overall goal is that the ‘trigger’ will essentially cut the tax cut in half by imposing tax increases five years into the tax cut."

Deloitte Tax director Jane Rohrs: "It infuses uncertainty into the whole decision-making process and makes it hard for companies plan their investment decisions."

Moody’s chief economist Mark Zandi: “It’s a bad idea. This reduces the economic benefit of the tax cut.”

Michael Materasso: “I don’t think the market would like a trigger like that. I don’t think business would like a trigger like that.”

PNC Financial Services Group chief economist Gus Faucher: “I’m concerned that if we hit a downturn, then we could have these automatic tax increases, and that would actually make the recession worse.”

William Gale, senior economics fellow at the Brookings Institution: "These triggers are not innocuous. They are dangerous."

Ernie Tedeschi, economist at Evercore ISI: A tax-hike trigger would act as “a further drag on GDP growth just as the economy is going south”

Alan Auerbach, a professor of economics and law at the University of California at Berkeley: “Talking about a trigger as if it could really provide an effective protection for the revenue loss, it’s not an effective policy. It’s bad economic policy.”

Alan Ruskin, Global Head of G10 FX Strategy and Macro Strategist at Deutsche Bank: "There is every risk that prescribed tightening in fiscal policy based on a future deficit number is highly pro-cyclical, reinforcing a growth slowdown. This seems like the worst of all worlds, a possible stimulus at a point when the economy does not need it, and if it does not support growth sufficiently, triggers a fiscal contraction when it is least needed!" 

Photo Credit:

Comments

×