Bessent, congressional Republicans kickstarting tax cut talks

Bessent, congressional Republicans kickstarting tax cut talks
House legislators are set to approve a mammoth budget that requires $2 trillion in spending cuts to clear room for a tax cut package by the end of the year.
FEB 24, 2025
By  Bloomberg

Treasury Secretary Scott Bessent and congressional leaders will begin meeting weekly as Republicans look to shape a tax cut package with a year-end deadline, according to people familiar with the matter.

The meetings, which will start this week, will include key Republican leaders, including House Speaker Mike Johnson, Senate Majority Leader John Thune, and Senator Mike Crapo and Representative Jason Smith, who chair the tax committees in each chamber. The people shared the details of the meetings on the condition of anonymity to discuss a matter which isn’t public.

The planned confabs are a sign that Republicans are getting serious about negotiating the contours of a tax deal, even as the House and Senate are pursuing separate legislative strategies. Politico first reported the planned discussions.

The impasse on legislative process has spurred divisions among Republicans and has slowed down talks to advance their priorities. The disagreement could be a harbinger of a deeper rift as lawmakers pass large-scale policies through tight majorities in the House and Senate.

The House has started the process to approve a massive, singular $4.5 trillion bill, that also includes energy and immigration measures and raises the debt ceiling. The Senate is pursuing plans to pass a border security bill in the coming months, leaving the tax negotiations until later in the year.

The House will vote as soon as Tuesday on a budget outline requiring $2 trillion in spending cuts in exchange for the tax cuts.

Republicans have until the end of the year to renew expiring portions of President Donald Trump’s first-term tax cut law, which reduced income rates on individuals and included a bevy of tax cuts for small businesses. Trump has also said he wants to expand those tax cuts to include a series of campaign trail promises, including ending levies on tipped wages, overtime pay and Social Security benefits.

The White House has also said it would like to pass several other tax measures that could prove to be controversial among Republicans, including an expansion to the state and local tax deduction, eliminating the carried interest tax break favored by private equity fund managers and terminating tax breaks for billionaire sports team owners.

Among the tax cuts set to expire at the end of the year are an expanded credit of up to $2,000 per child, a 20% write-off for small business owners and a higher standard deduction that simplifies the filing process for many taxpayers.

 

Latest News

In an AI world, investors still look for the human touch
In an AI world, investors still look for the human touch

AI is no replacement for trusted financial advisors, but it can meaningfully enhance their capabilities as well as the systems they rely on.

This viral motivational speaker can also be your Prudential financial advisor
This viral motivational speaker can also be your Prudential financial advisor

Prudential's Jordan Toma is no "Finfluencer," but he is a registered financial advisor with four million social media followers and a message of overcoming personal struggles that's reached kids in 150 school across the US.

Fintech bytes: GReminders and Advisor CRM announce AI-related updates
Fintech bytes: GReminders and Advisor CRM announce AI-related updates

GReminders is deepening its integration partnership with a national wealth firm, while Advisor CRM touts a free new meeting tool for RIAs.

SEC charges barred ex-Merrill broker behind Bain Capital private equity fraud
SEC charges barred ex-Merrill broker behind Bain Capital private equity fraud

The Texas-based former advisor reportedly bilked clients out of millions of dollars, keeping them in the dark with doctored statements and a fake email domain.

Trump's tax bill passes senate in hard-fought victory for Republicans
Trump's tax bill passes senate in hard-fought victory for Republicans

The $3.3 trillion tax and spending cut package narrowly got through the upper house, with JD Vance casting the deciding vote to overrule three GOP holdouts.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.