Republican senators trying to hash out a bipartisan deal to reduce the deficit will refuse any significant tax hikes, Sen. Tom CoburnTom CoburnGOP faces existential threat Sanders tops 2016 field in newly deleted tweets The Hill's 12:30 Report MORE (R-Okla.) said Thursday.
Coburn, one of six senators involved in behind-the-scenes talks considered crucial if there is to be a deal, said that while it was possible that some voters could see their tax burdens rise, the “Gang of Six” talks would not result in a significant tax hike.
Coburn’s comments suggest the senators are unlikely to agree to end the Bush tax rates for families with annual income above $250,0000, a priority for the White House.
President Obama wants a long-term deal to reduce the deficit to do away with tax rates for the wealthy put in place by former President George W. Bush. After agreeing to extend those tax rates in December, Obama said he would refuse to renew them again.
“We cannot afford $1 trillion worth of tax cuts for every millionaire and billionaire in our society,” Obama said in a speech last week laying out his vision for cutting the deficit.
The extension of all of the Bush rates in December is a major driver of the deficit, according to the Congressional Budget Office.
Polls suggest voter support for raising taxes on the wealthy, but Republicans are under heavy pressure from conservatives to include no tax increases as part of a deficit-cutting deal.
The House last week approved a budget that would lower the deficit by $5.8 trillion in the next decade. The proposal from Budget Committee Chairman Paul RyanPaul RyanFive takeaways from the Indiana primary Overnight Finance: IRS hiring hundreds of new tax enforcers ‘It’s a King Kong vs. Godzilla kind of race’ MORE (R-Wis.) would reform the tax code, lowering individual and corporate tax rates to boot. It would lower the deficit in part by making significant reforms to Medicare and Medicaid that have been the subject of political attacks by Obama.
In the Gang of Six talks, Coburn has been working for months with Republican Sens. Saxby ChamblissSaxby ChamblissWyden hammers CIA chief over Senate spying Cruz is a liability Inside Paul Ryan’s brain trust MORE (Ga.) and Mike CrapoMike CrapoHousing groups argue Freddie Mac's loss should spur finance reform Bipartisan effort seeks end to budget gimmicks Republicans mum on possibility of Trump filling Supreme Court seat MORE (Idaho) and Democratic Sens. Dick DurbinDick DurbinLobbying World Judiciary Dems seek hearing on voting rights Elizabeth Warren stumps, raises funds for Duckworth MORE (Ill.), Kent Conrad (N.D.) and Mark WarnerMark WarnerHousing groups argue Freddie Mac's loss should spur finance reform Week ahead: Rival encryption efforts clash on Capitol Hill Kaine, Brown, Perez on Clinton’s list of possible VPs: report MORE (Va.). Because of the bipartisan nature of the group, their work is considered one of the best hopes for reaching an accord on deficit and debt reduction.
The plan is due to be released sometime in early May, and Coburn emphasized Thursday that the Gang of Six hadn't reached any agreement at this point.
The Oklahoma conservative suggested that the Gang of Six is examining a kind of tax reform similar to the type suggested by Obama's fiscal commission, in which marginal rates are lowered but many tax credits are eliminated from the code.
"Will some people pay increased taxes? I'm sure they will," Coburn said of the resulting tax burden from such a plan.
Whether such a plan would be palatable to conservatives, including many of the groups who have pushed GOP lawmakers into taking "no new taxes" pledges over the years, is one of the big variables facing the Gang of Six.
Coburn defended such a proposal, which is still hypothetical at this point, on free market grounds. Tax credits, he said, allows for a system where "winners and losers [are] picked from Washington." Eliminating tax credits and lowering rates would allow for a more efficient allocation of capital, Coburn argued.
Coburn and Americans for Tax Reform President Grover Norquist have battled on this point in recent weeks, with Norquist arguing that the elimination of a tax break, if it is not coupled with a corresponding tax cut, would break the tax pledge many lawmakers have taken.
—This story was initially posted at 11 a.m.