U.S. Treasury Secretary Scott Bessent addresses President Donald Trumps economic and fiscal goals during his first interview on Kudlow since joining the administration.
Treasury Secretary Scott Bessent on Wednesday signaled that the White House wants Trump’s tax cut package from 2017 to be extended permanently before their expiration this year, rather than a temporary extension.
Bessent appeared on FOX Business Network’s “Kudlow” for an exclusive interview with host Larry Kudlow and addressed reports that Republicans in Congress are considering opting for a five or 10-year extension of the tax cuts to help comply with reconciliation rules, rather than making them permanent.
“President Trump has a mandate. He came in to do big things. And one of the big things that this administration wants to do is make the 2017 Tax Cuts and Jobs Act permanent – and that permanency will continue to make the U.S. the number one economy in the world,” Bessent said.
“We’re going to bring down inflation, we’re going to cut regulations, and we’re going to get the tax cut. The goal is still for them to be made permanent,” he added.
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Treasury Secretary Scott Bessent, left, is calling for Congress to make President Donald Trump’s tax cuts permanent. (Chris Kleponis/CNP/Bloomberg via Getty Images / Getty Images)
Secretary Bessent went on to say that the Trump administration plans to use “current policy scoring” for the bill to help it move through Congress.
The nonpartisan Congressional Budget Office (CBO) is responsible for scoring tax and spending legislation for its budget impact over time. CBO is currently required to use a current law baseline, which assumes that laws set to expire at a certain point in time do so at that time, when analyzing legislation or making budget projections. A current policy baseline would assume that certain laws are extended even if the law says they are due to expire.
“Up until a year ago, I was a civilian, I’ve been looking at CBO numbers for 35 years in my day job in the investment business, but I never understood the way this scoring worked. And it is tilted toward spending, and that’s why the spending has gotten out of control here in Washington,” he said.
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Bessent said that Republicans need to come together on the tax bill to avoid the largest tax cut in U.S. history. (DOMINIC GWINN/Middle East Images/AFP via Getty Images / Getty Images)
Congressional rules for budget reconciliation allow bills to bypass the Senate’s 60-vote threshold to overcome the legislative filibuster – but the bill can’t contain non-budget related provisions and can’t increase budget deficits beyond a set amount in a 10-year budget window.
To comply with those rules, the Tax Cuts and Jobs Act contained some provisions that were permanent, such as the lower corporate tax rate, while other provisions were made temporary with several key policies set to elapse at the end of this year.Â
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President Donald Trump signed the Tax Cuts and Jobs Act into law in 2017. Some of its key provisions are set to expire at the end of 2025. (Jabin Botsford/The Washington Post via Getty Images / Getty Images)
Notable provisions that are due to expire at the end of 2025 include those that lowered personal income tax rates, nearly doubled the standard deduction that most taxpayers claim when filing and expanded the child tax credit, among other items.
Bessent said that failing to extend the tax cuts would result in the largest tax hike in history, which would have a negative impact on the U.S. economy and Americans while also hurting the budget deficit through reduced growth.
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“What’s going to blow not only a hole in the budget deficit, in the economy and in the lifestyles of working class Americans [is] if we do not get this tax bill done,” Bessent explained. “As I said in my Senate hearings, this is pass-fail for our side of the aisle, and we will have the largest tax hike in history – the largest tax hike in history – and that will be on the people on our side who do not try to move this forward.”