Left criticizes permanent corporate cut, temporary family credit

Left criticizes permanent corporate cut, temporary family credit
© Greg Nash

Liberals are blasting the GOP's tax-reform plan for making a reduction in the corporate tax rate permanent even as a new family tax credit is phased out after five years.

The plan, released by House GOP tax writers Thursday morning, would cut the corporate tax from 35 percent to 20 percent, a major goal of President Trump and big business. 

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The family tax credit, which is targeted toward the middle class and would give people a new $300 credit for each child and non-child dependent, would be phased out after five years.

Seth Hanlon, a former assistant for economic policy to President Obama, on Twitter called the GOP plan a "middle-class time bomb, both in terms of the direct tax effects & indirect effects of $1.5T+ in debt on programs" and singled out in his criticism the disparity between the corporate rate reduction being made permanent and the new family tax credit being phased out.

Republicans say their bill would help middle class families, both by spurring economic growth and through changes in the code that would deliver tax relief.

"Under our plan, typical middle-class families will see bigger paychecks and receive a $1,182 tax cut," Speaker Paul RyanPaul Davis RyanMcConnell names Senate GOP tax conferees House Republican: 'I worry about both sides' of the aisle on DACA Overnight Health Care: 3.6M signed up for ObamaCare in first month | Ryan pledges 'entitlement reform' next year | Dems push for more money to fight opioids MORE (R-Wis.) said in a statement. "That means more take-home pay and more money in your pocket. Working with the Senate and President Trump, we are going to make good on our promise to deliver relief to the American people. It's time to get this done."

The bill, for example, would nearly double the standard deduction to $24,000, something that could help middle-class taxpayers and simplify the code, the GOP says.

But it would also eliminate some itemized deductions prized by taxpayers, including those for student loan interest and medical expenses.

The first question at the GOP House briefing on the bill to top tax writer Rep. Kevin BradyKevin Patrick BradyRyan pledges 'entitlement reform' in 2018 Senate approves motion to go to tax conference Overnight Finance: GOP delays work on funding bill amid conservative demands | Senate panel approves Fed nominee Powell | Dodd-Frank rollback advances | WH disputes report Mueller subpoenaed Trump bank records MORE (R-Texas) addressed the dichotomy of a temporary family credit with permanent corporate tax cuts. 

Brady responded that the economic growth that would be driven by the corporate rate would help all Americans.

Separately, Republican Sen. Marco RubioMarco Antonio RubioRyan pledges 'entitlement reform' in 2018 Richard Gere welcomes lawmakers' words of support for Tibet Dem lawmaker gives McConnell's tax reform op-ed a failing grade MORE (Fla.) has been pushing for a bigger expansion of the child tax credit, another break used by the middle class. 

Rubio wants the Senate's legislation to include a larger increase for the child tax credit, saying the $600 increase in the House bill doesn't meet his or Trump's goal "of helping working families."