Staff Reports
The Biden administration has mastered the art of kicking the can down the road when it comes to taxes—much to the delight of the populists who crave change. The president, who rose to power with the promise of transforming Trump’s legacy, has found himself grappling with multiple issues, and taxes seem to be among the stickiest. Despite Biden’s penchant for dismantling the previous administration’s policies, he hasn’t budged on Trump’s “Tax Cuts and Jobs Act”—a cornerstone achievement for the GOP that slashed the corporate tax rate from a whopping 35% to a more manageable 21%.
While Biden may have ambitions to rewrite tax laws, the reality is that he lacks unilateral power to overturn what was passed with bipartisan support. The cuts were solidified into law back in 2017, and unless Congress acts before the cuts expire in 2025, a dark cloud dubbed the “tax cliff” looms ominously over the economic horizon. Conservative analysts have pointed out that the precarious future of corporate taxes could be a major headache for Republicans as they navigate the 2024 elections. All eyes are on how Congress will handle this potential crisis—an entertaining plot twist in the ongoing political drama.
VP Harris wraps up her blitz of battleground states and calls to end federal taxes on tips, weeks after fmr. Pres. Trump made the same proposal. @maryaliceparks reports. https://t.co/i75MbfYpbV pic.twitter.com/fyChJtW9S2
— World News Tonight (@ABCWorldNews) August 12, 2024
Although Trump continues to champion his tax cuts, promising to lower the corporate rate even further to 15%, there’s a bit of a rebellion brewing within the GOP. Senators like J.D. Vance have shown signs of wanting to hit the brakes on further tax cuts, raising eyebrows and questions about party unity and strategy. As Dems amass power under the Harris banner, they seem to believe that reestablishing the tax rate near 28% will pacify their left-leaning radicals—a magical number that might not even appease everyone in their own party. If the Democrats regain legislative control, the expiration of tax cuts and potential hikes may become a relaxed stroll down a well-worn path.
Republican strategists are scratching their heads at the prospect of a Trump-Vance dynamic; the current administration’s populist wing seems more inclined to exploit corporate tax increases to fund individual tax breaks, a dance that could leave voters confused and frustrated. Outside of Congress, some conservative thinkers are already contemplating revenue-generation measures that could involve raising corporate taxes. Who knew that an economic crisis could lead to so much open-mindedness about tax increases amongst those who fashioned themselves the champions of lower taxes?
As the Democratic ticket now seems to gain traction, opportunistic candidates are already eyeing key Senate races where they can project an image that aligns them with the excitement of a fresh Biden-Harris campaign. With Republicans set to unleash their most potent resources in battleground states, and the potential of backlash against Democrats’ far-left agendas, it’s hard to say how the tax debate will play out.
Amidst this electoral fervor, one thing is clear: whether the tax cuts thrive or perish will heavily depend on who occupies the Oval Office and who controls Congress. For Republicans, it’s a joyous thought to imagine tax structures that privilege hard work and entrepreneurship instead of further burdening the very job creators they purport to champion. Yet with Democrats increasingly emboldened, there’s little doubt that this tax saga is far from over.
