Mulvaney Says Would Be OK to Drop Mandate Repeal From Tax Plan

The White House would support removing from the Senate tax plan a controversial provision to repeal the individual health care mandate of the Affordable Care Act, budget director Mick Mulvaney said -- a move that could help win the vote of key Republicans.

The provision could be dropped if it becomes “an impediment,” Mulvaney, head of the Office of Management and Budget, said on CNN’s “State of the Union.”

“I don’t think anybody doubts where the White House is on repealing and replacing Obamacare: We absolutely want to do it. If we can repeal part of Obamacare as part of a tax bill and have a tax bill that is still a good tax bill that can pass, that’s great,” he said. “If it becomes an impediment to getting the best tax bill we can, then we’re OK with taking it out.”

At the same time, White House legislative director Marc Short said the administration approves of the Senate included the repeal of the individual mandate in the bill because it predominately affects those earning $50,000 a year or less.

“The White House is very comfortable with the House bill,” Short said on ABC’s “This Week” on Sunday. “We also, though, believe the individual mandate is a tax, and it is harming middle-income families the most. So we like the fact that the Senate has included it in its bill.”

Mulvaney made three appearances on Sunday political talk shows. Treasury Secretary Steve Mnuchin and Short also spoke, reflecting the Trump administration’s full-bore attempt to sell the Republican tax plans now working their way through Congress.

Tight Schedule

House Republicans passed their plan on Thursday afternoon, and later that night their colleagues on the Senate Finance Committee approved a far different version that postpones difficult questions as lawmakers rush to refashion much of the U.S. economy on the tight schedule demanded by President Donald Trump.

Some Republican senators have expressed concern about the plan. One, Senator Ron Johnson of Wisconsin, has said he can’t support the proposal as written.

The House bill, passed on a party-line vote, would lower the corporate tax rate to 20 percent from 35 percent, shrink the number of individual tax brackets to four from seven, and scrap many popular tax breaks and deductions. Several Republicans from districts in high-tax states, including New York and New Jersey, voted against the plan.

Critics are also worried that both the Senate and House plans would drive up the federal budget deficit, despite assertions from the White House and many lawmakers that they would pay for themselves over time by increasing economic growth.

Deficit Impact

“It’s just not economically rational” to say that the plans would increase the federal deficit, Kevin Hassett, the chairman of the White House Council of Economic Advisers, said at the daily White House briefing on Friday.

Independent studies have reached differing conclusions. The conservative-leaning Tax Foundation, a Washington policy group, said earlier this month that the House’s tax bill would cost $1.98 trillion over a decade compared with current law. About half of that may be offset by higher growth, the foundation estimated.

Meanwhile, the Penn Wharton Budget Model at the University of Pennsylvania found that, after accounting for larger economic effects, the House bill would “reduce revenues between $1.5 trillion and $1.7 trillion” over 10 years. The Senate plan would reduce revenue by $1.4 trillion to $1.7 trillion, the model found.