Trump budget bill failure could lead to ‘largest tax hike in history,’ lawmaker warns
Republican Study Committee (RSC) Chairman August Pfluger, a representative from Texas, has issued a dire warning on Tax Day regarding the potential financial burden that American families may face next year if Republicans do not succeed in passing a comprehensive conservative policy overhaul. In an exclusive statement to Fox News Digital, Pfluger emphasized the importance of extending President Donald Trump’s 2017 Tax Cuts and Jobs Act (TCJA) through a budget reconciliation bill to prevent a significant tax increase for millions of Americans.
Pfluger highlighted the potential consequences of allowing the tax cuts to expire, stating that approximately 40 million families and 26 million small businesses could see their taxes increase by as much as 22%, marking the largest tax hike in history. He emphasized the need to make these tax cuts permanent to support job creation, stimulate economic growth, and shield families from the tax policies advocated by the Left.
The RSC, which serves as the House GOP’s primary conservative think tank with over 175 members, is actively advocating for the permanent extension of President Trump’s tax cuts. Rep. Beth Van Duyne, who chairs the RSC budget task force, echoed Pfluger’s sentiments, emphasizing that extending the TCJA and implementing other tax initiatives proposed by Trump would enhance the country’s appeal for investments, business expansion, and job creation.
Tax reform is a pivotal component of the Republicans’ strategy for reconciliation, a legislative mechanism that enables the majority party to enact significant fiscal and budgetary changes with a lower threshold for approval in the Senate. Additionally, in addition to extending the TCJA tax cuts, Trump has proposed eliminating taxes on tipped and overtime wages, as well as on Social Security benefits for retirees.
Last week, House Republicans passed a framework aligning with the Senate’s budget reconciliation bill, allowing relevant congressional committees to commence work on developing policy specifics. However, the path to passing a bill in both chambers remains challenging, given the slim majorities held by Republicans in both the House and Senate. The House version of the bill calls for at least $1.5 trillion in spending cuts, while the Senate is aiming for $4 billion, with a commitment to exceed this target.
Extending the TCJA alone would result in a $4.5 trillion decrease in federal revenues, according to the Tax Foundation. House conservatives are advocating for substantial government funding cuts to offset this revenue loss, with the RSC steering group urging deficit-neutral reconciliation legislation.
Failing to extend Trump’s tax cuts before the 2026 midterm elections could have severe political repercussions and raise concerns about a potential economic downturn, especially when considering the impact of additional costs stemming from Trump’s tariffs. Experts warn that the expiration of the tax cuts could result in a significant financial loss for American families, with estimates suggesting an average household could lose $1,000 if the tax cuts are not extended.
In conclusion, the House Ways and Means Committee has echoed Pfluger’s concerns in a memo released late last year, emphasizing the urgent need for Congress to act swiftly to prevent a looming tax hike and provide Americans with the reassurance that the tax relief they rely on will remain in place. As the debate over tax policy intensifies, the fate of President Trump’s tax cuts hangs in the balance, with significant implications for American families and the broader economy.
