Senior Farm and Ranch Broadcaster Ron Hays is back, talking with NCBA’s Vice President of Governmental Affairs, Ethan Lane. Yesterday, they discussed why NCBA supports Trump’s tariff policies. Today, they are talking about the challenge of getting a tax cut deal done in 2025.
“One big, beautiful bill continues to capture the imaginations of policy makers throughout Washington,” Lane quipped. “Unfortunately, that dream runs into the reality of what has been and continues to be a bitterly divided Congress.”
He described a four-seat cushion for Speaker Mike Johnson in the House Republican Conference as the “sweetest deal he has seen in some time, now.” Even still, a few holdouts are preventing the bill from progressing.
“We are going to see this week whether he can navigate those choppy waters and get enough of his conference onboard to advance this,” Lane said. “The reason for using a reconciliation bill to do this is that it is a simple majority vote. It lowers the threshold; it makes it easier to get to ‘yes’ on this, not just in the House, but on the Senate eventually as well.”
He emphasized the tight margins between the parties in both the House and Senate, which empowers the holdouts. He explained, “Like we have seen in the last few weeks, where we have had some stop and starts with votes. We’ve seen some votes cancelled, kind of a continuation from that last Congress. But we are going to be watching to see how that plays out, and I think we need to be prepared for the fact that we could have some false start weeks. We could see this week fall apart, and they could come back and try ‘er again after the Easter recess. We’ll just have to watch and see.”
He pointed out that the discussions in Congress would be regarding a five-year reauthorization of the 2017 Tax Cuts and Jobs Act, not a permanent policy.
“There are a lot of folks, ourselves included, that would love to make these permanent,” he shared. “But at the end of the day, this is a math equation. It is factoring in the cost of those provisions over the course of ten years and what it does to the federal budget not to have that revenue coming in.”
Other factors in the equation are whether or not the tax cuts will allow for economic growth in various tranches of American society, whether it be farmers’ and ranchers’ ability to deduct the cost of heavy equipment and preserve the value of the operations to pass them on to the next generations without tax penalties.
“Those are all things that have an inherent economic benefit, not just to agriculture, but to the entire economy in the form of that money being spent in the economy rather than being sent to Washington,” Lane detailed. “That is the math problem that is being solved right now. That is the argument. If you look at the cuts on their own, if you look at the extension of those provisions, it’s about a four trillion-dollar price tag.”
The question boils down to whether or not an extension would be a continuation of baseline spending or new spending. Lane answered for NCBA by saying, “Our argument, and others’, is that it is a continuation of baseline spending because we have been operating under that since 2018. The Senate parliamentarian agrees, and that is the format they are using moving into this.”
According to Lane, a resolution cannot happen soon enough. He said, “The earlier, the better to provide that all-important consistency and reliability to the supply chain. It is the unknown that causes the biggest problems in the economy. The quicker they can get this dealt with, the quicker they can get it off of the agenda, and folks can go back to paying attention to their businesses rather than the taxes they are going to pay on that business, the better off the economy will be.”
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