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Repatriated revenue from an international tax overhaul is slated to pay for tax cuts, not infrastructure, leaving questions about how the White House will fund its infrastructure proposal, a pair of senior Republican lawmakers told Bloomberg Government.
Revenue from repatriating taxes on overseas corporate earnings was floated as a possible way to fund a $200 billion direct federal investment in infrastructure, as part of President Donald Trump’s promised $1 trillion infrastructure package.
Rep. Mario Diaz-Balart (R-Fla.), a senior member of the House Budget and Appropriations committees, had hoped income from repatriation could help pay for an infrastructure package, he told Bloomberg Government.
“We may have already lost that battle because it seems that it’s all going to tax reform,” he said.
The battle is lost, Sen. John Thune (R-S.D.), a member of the tax-writing Senate Finance Committee and the fourth-ranking Republican, told Bloomberg Government.
“Repatriation is going to be an offset for tax reform,” Thune said.
Thune and Diaz-Balart both put the onus on the White House to come up with a solution to fund infrastructure.
“We need to pay for this stuff and there are other ways of doing it and I’m anxious to hear what those are,” Thune said.
Gary Cohn, President Trump’s top economic adviser, suggested during an Oct. 25 meeting with a bipartisan group of lawmakers that a gas tax increase could help fund a 2018 infrastructure plan, Bloomberg News reported. Trump previously told Bloomberg News that he would consider raising the tax, which goes to fund the federal Highway Trust Fund.
The tax is currently 18.4 cents per gallon for gasoline and 24.4 cents per gallon for diesel and has not been increased since 1993. The trust fund has required several infusions from the general fund in recent years to remain solvent.
Thune said he had been under the impression until Oct. 25 that a gas tax increase was off the table.
Whether he would support an increase “would depend entirely on the context—if we could reduce some taxes in other areas,” he said.
“I do think that we’ve got to deal with the trust fund shortage,” Thune said. “If we’re going to have a Highway Trust Fund and that’s how we’re going to fund infrastructure, we can’t continue to borrow from the general fund put it on the debt and bill to our kids. That doesn’t make sense.”
House Republicans do not expect a gas tax increase would pass that body, but several lawmakers said they were open to the idea.
“Everything is on the table, I’ve always said that. I think it would be hard to pass a gas tax over here. We’ll wait and see they come up with and what their proposal is. I haven’t talked to Cohn, yet,” Rep. Sam Graves (R-Mo.) told reporters Oct. 26.
Diaz-Balart opposes an increase in the gas tax, which he called “regressive” and not sustainable.
“I know that people have considered it to fix the hole in the DOT trust fund, but I don’t think that’s the way to do it,” he said.
With repatriation revenue promised elsewhere and a gas tax increase looking questionable, Republicans are looking to the White House for details and ideas on how to fund the president’s much-touted infrastructure proposal.
Diaz-Balart said he is “curious” to see how the administration plans to fund the yet-to-be-revealed infrastructure plan.
“I’m open to different ideas when it come to infrastructure and at this point I’m not ruling anything out,” Thune said.
The administration expects to unveil more details on its infrastructure proposal after Congress deals with the tax overhaul. The dwindling congressional calendar all but guarantees work on an infrastructure bill won’t get underway until 2018.
To contact the reporter on this story: Shaun Courtney in Washington at email@example.com
To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com
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