According to Bloomberg’s August poll of economists, tax cuts can be expected by November 2018.
The majority of U.S. economists surveyed in Bloomberg’s August poll predict that President Donald Trump and Congress will successfully pass tax cuts by November 2018, on schedule for the congressional elections. The administration has promised that the tax plan—which includes cutting individual and corporate tax rates and reforming the tax code—will raise GDP growth to 3 percent, up from the Obama administration’s average rate of 2.1 percent.
Thirty-eight economists responded to Bloomberg’s poll in early August, and of those, 29 said that tax cuts will be passed through Congress by November 2018.
The economists’ forecast considers the likelihood that legislators will use a budget procedure to pass reform, a strategy that allows lawmakers to avoid resistance in the Senate. But a condition of using this approach requires imposing an expiration date on the tax cuts, should they increase the federal deficit in the long run.
The White House has shown commitment to overhauling the federal tax system by announcing a timeline to revise the bill after Labor Day in order to push the legislation through the House and the Senate by November.
“We are on track to deliver transformational, bold tax reform this year because President Trump and the House and Senate are working together to deliver on that timetable,” said Chairman of the House Ways and Means Committee Kevin Brady on CNBC.
For small business to benefit from proposed tax reform, tax rates should be lowered, but small businesses need tax rate parity with larger corporations and a simplified tax code as well. “Tax reform must reduce rates on both pass-through entities and corporations simultaneously,” said NFIB President and CEO Juanita Duggan in a written testimony to the U.S. House Committee on Ways and Means. “Otherwise, the tax code will simply grow more lopsided and complex. The effect of complexity and the preservation of cash flow are key elements for small businesses as Congress considers comprehensive tax reform.”