House Speaker Paul Ryan pushed back Tuesday against some members of his own party in Congress and the Trump administration who have said they are open to a temporary tax reform plan.
“These reforms — these tax cuts — they need to be permanent,” Ryan said at the National Association of Manufacturers annual policy summit. “Every expert agrees that temporary reforms will only have a negligible impact on wages and economic growth.”
Ryan also said reforming the tax code was essential to discouraging businesses from offshoring jobs and corporate revenues. But he didn’t mention the part of the House GOP plan meant to accomplish that — a controversial tax on imports known as a “border adjustment.”
With tax reform taking longer than expected, some former Trump campaign advisers, a growing number of Ryan’s congressional colleagues and White House officials have suggested abandoning broad reform and simply cutting taxes.
But that would almost certainly mean the tax cuts would be temporary, since the budgetary maneuver Republicans are hoping to use to short-circuit a Senate Democratic filibuster prohibits legislation from expanding the deficit outside of a 10-year window. Ryan says the long-term tax reform plan championed by House Republicans wouldn’t add to the deficit.
“Businesses need to have confidence that we will not pull the rug out from under them,” Ryan said. “They need the certainty from permanent tax cuts to hire more workers, invest in their businesses, and plan for the future.”
Despite the differences that remain to be worked out between the House, Senate and White House, Ryan said tax reform would get done this year.
“We think this is eminently doable, to get it done by the end of the calendar year,” he said in a question-and-answer session after his speech. “… So that come the first of  we have a new system in place and everybody knows the rules of the road.”
Vice President Mike Pence, speaking at the same event, made a similar vow. After Congress repeals and replaces Obamacare, he said, “we’re going to pass the largest tax cut since the days of Ronald Reagan and we’re going to do it this year.”
Ryan’s speech also touched on Republican efforts to unwind regulations they say hamper business and their health care push. But ahead of the speech, aides highlighted the remarks he would make on tax reform.
Ryan’s call for permanent tax reform shows that there is still a lot of daylight between Republicans on the top item of their economic agenda. In addition to their differences over whether tax reform should be permanent, the GOP is sharply divided on the House border adjustment tax.
Ryan and House Ways and Means Chairman Kevin Brady are counting on the plan, which would allow exports to be tax free, to raise approximately $1 trillion over 10 years. In addition to helping make up money the government would lose by lowering tax rates across the board, the proposal is meant to discourage large companies from moving their operations abroad.
“We are actually unique in the world in the way we discourage capital from coming back to America and how we incentivize offshoring jobs,” Ryan said. “This is not the kind of exceptionalism we should aspire to. … We must think differently, so that once again we make things here and export them around the world.”
But Treasury Secretary Steven Mnuchin, along with many House and Senate Republicans, has publicly criticized the provision as too harsh. The opponents have yet to offer an alternative, however.