Cato Podcast One Big Beautiful Podcast
Jul 1, 2025
The discussion dives into the complexities of new tax legislation moving through Congress, focusing on the urgent need to address impending tax hikes. They break down the intricate relationship between tax policy uncertainty and economic growth, advocating for permanent reforms. The speakers critique traditional depreciation methods, promoting full expensing as a better alternative. They also challenge the myths surrounding tariffs as a reliable revenue source, calling for a comprehensive tax overhaul to foster a pro-growth environment.
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Impact of 2017 Tax Reform Expiry
- The 2017 tax reform's temporary provisions expiring causes a $500 billion yearly tax hike if nothing passes.
- This creates significant policy uncertainty that can stall business investment and economic growth.
Complexity Added by Tax Bill
- The House tax bill extends individual cuts permanently but business incentives like full expensing remain temporary.
- It adds many new carve-outs and subsidies, increasing complexity and fiscal costs.
Senate Tax Bill Priorities
- The Senate should keep House wins like IRA subsidy repeal and roll back excessive state and local tax deduction expansions.
- Permanence for pro-growth policies like full expensing is crucial for lasting economic benefits.