Brady makes the case for revenue-neutral tax reform

Brady makes the case for revenue-neutral tax reform
© Greg Nash

House Ways and Means Committee Chairman Kevin BradyKevin Patrick BradyOn The Money — Sponsored by Prudential — Trump angers GOP, businesses with new tariffs | Liberals see Kavanaugh as mortal threat to consumer bureau | Lawmakers pitch family leave plans Trump tariffs prompt rising fear, anger from GOP, business Top House Republican calls for Trump to meet with Chinese president over trade war MORE (R-Texas) made the case for revenue-neutral tax reform on Wednesday, following a report that some advisers to President Trump and lawmakers are potentially interested in enacting tax cuts that aren't offset.

"I believe, both the most pro-growth approach we can take, and the fiscally responsible approach we can take, is to break even with the budget, counting on just solid, verifiable economic growth," he said at a Financial Services Roundtable event.

Politico reported Wednesday that some Trump aides are questioning the need for tax reform to maintain current revenue levels. Sen. Rand PaulRandal (Rand) Howard PaulRand Paul ‘concerned’ about Kavanaugh Rand Paul on Russia indictments: We should focus on protecting elections instead of 'witch hunt on the president' Sunday shows preview: Trump readies for meeting with Putin MORE (R-Ky.) has also advocated for tax cuts that aren't paid for.

A tax-reform bill that increases the deficit would contrast with goals expressed by GOP congressional leaders. Both House Speaker Paul RyanPaul Davis RyanGOP leaders jockey for affection of House conservatives Five GOP lawmakers mulling bid to lead conservative caucus On The Money — Sponsored by Prudential — Trump walks back criticism of UK Brexit strategy | McConnell worries US in 'early stages' of trade war | US trade deficit with China hits new record MORE (R-Wis.) and Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellDoug Jones walks tightrope on Supreme Court nominee Kavanaugh gets questionnaires for confirmation hearing Dem infighting erupts over Supreme Court pick MORE (R-Ky.) have said they want tax reform to be revenue-neutral. A revenue-neutral bill would be easier to pass under budget reconciliation, which allows bills to clear the Senate with only 50 votes.

Trump's Treasury secretary nominee, Steven Mnuchin, has also said he thinks tax reform shouldn't increase the deficit.

Brady said lawmakers have been having "terrific discussions" with Trump's team about tax reform, and the revenue-neutrality issue is part of the discussion.

The House Republican blueprint that the Ways and Means Committee is working to turn into legislation is intended to be revenue-neutral after accounting for economic growth. Brady said that the plan would result in lost tax revenue in the early years of implementation but would make up for those losses later on, so it would break even within the 10-year budget window.

"After that, it creates significant revenue going forward, which helps us with our debt and deficits," he said.