The $5 trillion dollar issue neither campaign wants to talk about

Why aren’t the presidential candidates talking about it more? Liam Donovan, a Republican strategist not working for either presidential campaign, said that the facts around the 2017 law create some uncomfortable messaging issues for both of them.

“On the GOP side, you can warn of the coming tax hikes — but then you’d have to remind people why this exists,” he said, referring to how Republicans put sunsets on the individual tax cuts while making corporate tax cuts permanent in order to pass the bill. “On the Dem side, you could lean into that and say, we told you this is bad! But they don’t want to remind people they’re on board with the $5 trillion in Biden raisers.”

There’s also a simple reason Harris might be reluctant to discuss the expiring Trump tax cuts: She’s promising to keep most of them. Her campaign has pledged not to raise taxes on Americans making less than $400,000. And while she and other Democrats have criticized the law’s high-end and corporate tax breaks, her party doesn’t want to dwell on how much of the total package falls outside those categories, especially given that Republicans have struggled to convince ordinary voters that the law benefits them. According to an analysis by the nonpartisan Committee for a Responsible Federal Budget, Harris’ promised Trump tax cut extensions constitute the most expensive part of her economic plans — potentially costing more than $3 trillion over ten years, versus over $5 trillion for Trump’s fuller extension plan.

With little coming from the candidates themselves, pro-business groups are trying to fill in the blanks for voters — and for members of Congress either facing re-election or simply unacquainted with the tax code’s intricate details themselves. Turnover in Congress means there’s been a brain drain on tax-writing committees like House Ways and Means: Only five Republicans remain on the panel who served in 2017.

The U.S. Chamber of Commerce and the National Federation of Independent Businesses are taking out ads spotlighting their tax priorities, such as preserving the 21% corporate tax rate and extending a deduction allowing some business owners to deduct 20% of their net business income when calculating taxes. This week, the Chamber began running spots in 19 competitive races that urge Democrats and Republicans to stop “the largest tax increase in history,” a veiled reference to the 2017 law’s expiration dates next year.

“The Chamber is the first organization that’s out there injecting tax into the conversation right now,” said Ashlee Rich Stephenson, the Chamber’s senior political strategist. “It’s not necessarily intended to move big blocks of voters. This is to communicate with constituents who we know feel strongly about the issue. We want to make it clear that this is where we’re headed.”

The lack of explicit conversation around the Trump tax cuts has also frustrated progressives, who effectively campaigned against the 2017 package as a giveaway to the wealthiest Americans. Harris has proposed new taxes on the wealthy, but she has also scaled them back a bit — she endorsed a rise to a 28% top capital gains tax rate for people making over $1 million a year, less than Biden’s promise to tax them at a 39.6% rate.

“The coming battle over extension of the expiring Trump-GOP tax cuts for the wealthy deserves more attention in both the presidential and congressional races,” said David Kass, the executive director of Americans for Tax Fairness Action Fund, which organized rallies against the 2017 tax cut. “Trillions of dollars in revenue, the basic fairness of our tax system, and economic inequality and opportunity are all at stake.”

The simplest reason why the tax issue isn’t driving this campaign is that the 2017 tax cut package already exists — and there’s little sign it’s going anywhere. All of the Republican 2001 and 2003 tax cuts for lower earners were renewed in 2012; most wage-earners who still remember paying Clinton-era income taxes are meeting with retirement planners.

That experience encouraged Republicans, who took a gamble when they put expiration dates — necessary for getting the deficit-busting cuts through the Senate — on the Bush tax cuts. The timeline for those ran out with President Barack Obama in the White House, presiding over a sluggish economy, and the vast majority of the tax cuts were extended. The worst case scenario for the GOP is a sequel, with a new president who has said she’d keep much of a law she voted against as a senator and even once vowed to repeal, deciding whether to raise taxes heading into a midterm election.

“The moment is hers and I do think that is going to be a hard fight,” Lindsay Owens, executive director of the left-leaning Groundwork Collaborative told Semafor. “We have not done very well in taxing the wealthy.”

Voters still tell pollsters that they believe taxes are too high, but the Trump and Harris campaigns, judging by their policy rollouts, have demonstrated that income tax rates aren’t top of mind anymore. Harris’s plans rely on channeling revenue from a higher corporate tax rate and capital gains tax towards an expanded child tax credit, new tax breaks for homebuyers and business startups, and establishing new benefits like Medicare home care, vision and hearing coverage. To the extent she can achieve any of these ideas as president, it might be in the Congressional horse-trading over the expiring Trump tax cut provisions.

Trump, who has never campaigned on revenue-neutral policies, is promising a blanket extension of his signature tax law (minus its SALT provisions) in tandem with passing a flurry of new giveaways that’s bound to cause Republican headaches — no taxes on tips and Social Security, tax breaks for generators, and more. In his speeches and interviews with business executives, Trump will promise to extend the cuts and grow the economy and pay for his agenda with tariffs. On the latter, he tends to downplay some of the potential repercussions many economists warn about, such as prices on common goods surging and allies and rivals alike retaliating against US exports.

“It’s gonna have a massive effect, positive effect,” Trump said Tuesday at the Economic Club of Chicago. “If you don’t do this, this country has no chance.”