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To: Interested Parties

From: Lael Brainard

Re: The High-Stakes Tax Debate in 2025

Date: June 13, 2024

The stakes of the coming tax debate over the expiring Trump tax cuts are clear: While President Biden

Congressional Republicans are clear that their top priority for the first 100 days of 2025 is to secure a tax

cut skewed to the ultra-wealthy while making hardworking Americans pay the price—and new reporting

this week suggests they want to expand even further on the Trump corporate tax giveaways.

Congressional Republicans should be transparent about how they want working families to pick up the $5

trillion tab for their tax cuts skewed to the ultra-wealthy and their additional corporate tax cuts. Their

record shows they will cover the cost through some combination of taxing everyday household purchases,

making deep cuts to Social Security and other programs millions of Americans count on, or ballooning

the deficit, as they did in 2017 when they had unified control of government. One way or another, the

American people will pay the price.

1. Reward work, not wealth. The President has pledged that the over 95% of American households

that earn less than $400,000 will not pay more in taxes. He has also proposed tax cuts to help millions

invest in their children, make work pay, and secure health insurance.

2. Raise revenue to honor the President’s commitment to seniors and fiscal responsibility. That

means we cannot give the wealthiest Americans another tax cut, so we must let the Trump tax cuts

expire for those making more than $400,000.

3. Raise revenue by asking corporations that are making record profits to pay their fair share. It

doesn’t make sense that the corporate tax share is low at a time when corporate profits are at record

wealthy and large businesses, while providing a better tax filing experience.

5. Avoid an international race to the bottom on tax. Implementing the President’s global minimum

tax would level the playing field for small businesses and stop other countries from luring jobs away

from the United States with rock-bottom tax rates.

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Congressional Republicans’ Tax Cuts Skewed to the Ultra-Wealthy Cost Nearly $5 Trillion

While President Biden is fighting for a tax code that works for the middle class, Congressional

Republicans are doubling down on their same tried-and-failed trickle-down approach of cutting taxes for

the ultra-wealthy. The 2017 Trump tax cuts added $1.9 trillion to the debt, and delivered tax cuts to those

in the top 1% worth 50 times more than for middle-income households. Now, Congressional Republicans

GOP tax plan would cost almost $5 trillion

Source: NEC analysis, Congressional Budget Office estimates

And the Cost of the Republican Tax Plan Could be Even Higher

Many Congressional Republicans want to go even further in providing tax breaks to large corporations

dollar corporations. Recent analysis shows that change coupled with a 15% corporate tax rate would

provide a nearly $50 billion annual tax cut to the 100 largest companies in America alone. And it

would bring corporate tax revenues as a share of the economy even further below other countries.

Republicans are pursuing these additional corporate tax cuts despite evidence suggesting their last

corporate rate cut failed to deliver the jobs and investment that were promised.

• Undermine investments in making sure the wealthy pay what they owe. Today, House

Republicans are advancing an appropriations bill that slashes the IRS budget and have said they want

to claw back “as much as [they] can” from President Biden’s IRS investment—which would make it

easier for the wealthy and big corporations to avoid paying the taxes they owe. The IRS should have

Congressional Republicans should show how they would pay for their tax cuts skewed to the

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wealthy. Every major Republican fiscal policy in recent decades has put the economic burden of their tax

cuts for the wealthy and corporations on low- and middle-income Americans – and this time will be no

different. Here are four ways Congressional Republicans might finance their costly tax cut agenda based

on their recent efforts:

1. Impose a tax on American consumer purchases. House Republicans are considering a 10% across-

2. Cut Social Security, Medicare, Medicaid, and the ACA. The Republican Study Committee (RSC)

Budget—which represents 80% of House Republicans and 100% of their leadership—called for over

$1.5 trillion in cuts to Social Security, including increasing the retirement age to 69 and cutting

disability benefits. That’s not nearly enough to pay for their tax cuts, so their plan would also cut

ten years, taking coverage away from millions of people, eroding care for seniors, children, and

people with disabilities, and taking us back to the days where people could be denied care for pre-

existing conditions and charged more for being a woman.

Medicare, and raise housing costs for hundreds of thousands of families—and a deeper cut would be

more devastating.

4. Increase the debt by $5 trillion. Last time around in 2017, when they controlled the White House

and both chambers of Congress, Republicans simply added $1.9 trillion to the national debt rather

than paying for their massive tax cuts skewed to the rich and big corporations. We know that

Republicans will then try to put the burden of this higher debt on the American public to pay for those

tax cuts for years into the future.