Getting congressional approval for a major tax reform plan is likely to be even more difficult than repealing and replacing the Affordable Care Act, U.S. Sen. Bob Corker, R-Tenn., said this week.
In an interview on CNBC's "Squawk Box" on Tuesday, Corker said he is hopeful the GOP-controlled Congress can fulfill the pledge of President Donald Trump and the Republican Party to bring down America's corporate tax rate more in line with the rest of the world and to approve other pro-growth tax policies.
But Corker said to avoid adding to the budget deficit, the tax base will have to be broadened. Each tax break removed from the tax code is likely to generate opposition, he said.
"Personally, I think tax reform is harder than health care," Corker said. "We've got a lot of work to do. My whole August was meeting with people who were saying, "Corker, I'm all for pro-growth tax reform, but there is this one thing we don't want you to touch." So I actually think the difficulty [for tax reform] is greater than with health care, but I'm all for it and I hope we can move ahead."
Corker said he hopes to play a key role in any tax reform debate in the Senate, where he serves on the Senate budget committee.
But unlike some ardent tax-cut, supply-side economic supporters, Corker said he wants to make sure that any tax reform plan doesn't add to America's long-term deficit, which he said is the biggest threat to America's future.
"We've got to move ahead and try to deal with the revenue piece," said Corker, who recently met with Treasury Secretary Steve Mnuchin about White House plans for tax reform. "At the end of the day, our nation is going to end up with trillion dollar-a-year deficits in a just few years, and we already have $20 trillion in debt."
Corker said the most important need is to bring corporate tax rates down to help American businesses compete in the global economy, since most nations tax corporations at a lower rate than the U.S. corporate rate of 35 percent and to do so without adding to the federal deficit.
"I am not about to vote for a bill that I think is going to increase deficits in our nation," Corker said.
State and local tax exemptions of federal tax bills are worth $1.2 trillion over the next decade and could be eliminated to offset revenue losses from cutting the corporate income tax, which most economists contend would help spur more business investment in the United States. To remain revenue neutral and offset the costs of cutting the corporate tax rate, another $2.8 billion of exemptions and tax breaks also will need to phased out over the next decade.
But eliminating such tax breaks will be controversial and could push up tax bills for many wealthy Americans, Corker said.
Based upon his talks with Trump advisers, Corker expects wealthy individuals could end up paying higher rates of taxes under the White House tax reform proposal because of the cuts planned for many existing exemptions now allowed under the tax code.
"Based upon my meetings with the president's team, it is my expectation that [under the White House plan] high wage earners to be paying more," Corker said.
The Associated Press contributed to this story.
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