GOP Tax Reform Plan Barrels Forward

Earlier this month, the House passed the sweeping Republican tax reform bill in a 227 to 205 vote, Inside Higher Ed reported. Thirteen Republicans voted against the plan. The bill did not receive support from any Democrats.

At the same time, lawmakers on the Senate Finance Committee voted to advance its chamber's version of the legislation. The package moved further along on Monday as the Senate Budget Committee voted along party lines to approve the plan, clearing the way for consideration by the full Senate. Lawmakers are poised to vote on the measure on Friday.

Several hurdles remain, however, including resolving differences with the House version of the tax bill, which differs in significant ways from that of the Senate, The New York Times reported.  

Both measures are widely opposed by higher education leaders who are concerned that many of the proposed provisions will make a college degree less attainable and hurt the financial strength of institutions.

Additionally, if Republicans succeed in passing the tax plan, it could cue $150 billion in automatic spending cuts to a host of federal programs including student loans, according to Politico.

Under the decades-old "Pay As You Go" rules, the legislation, which would add $1.5 trillion to the deficit over the next decade, would trigger $150 billion in mandatory budget cuts every year for the next 10 years, as detailed in an explosive Congressional Budget Office report.

The automatic cuts to student loan spending, which would be just one of a range of government programs that could take a hit, would be implemented through a mechanism known as sequestration and take the form of increased origination fees on new loans.

 

Related Links

Inside Higher Ed

https://www.insidehighered.com/news/2017/11/17/house-passes-tax-plan-many-provisions-opposed-colleges

The New York Times

https://www.nytimes.com/2017/11/28/us/politics/republicans-tax-bill-senate.html

Politico

https://www.politico.com/newsletters/morning-education/2017/11/20/whats-next-for-the-cfpbs-work-on-education-issues-028600