Amidst the headline-grabbing activity taking place within the White House, some important reforms are at work in Congress.
The Committee for a Responsible Federal Budget (CRFB), a nonpartisan 501(c)(3) provides a sense of the 
substance included in the House Fiscal Year 2018 (FY18) budget resolution. Below is a top-line summary of the House resolution, along with a brief note on how this process will allow Congress to move forward with tax reform legislation using budget reconciliation procedures.
While the Senate has not yet completed the FY 2017 budget process, because they were utilizing that budget resolution to attempt to repeal parts of the Affordable Care Act, the House Budget Committee made progress on tax reform by passing its FY18 budget resolution. The resolution has two features: (1) A framework for spending priorities for the upcoming fiscal year and (2) Specific reconciliation instructions for tax reform. It is to be noted that the existing House budget proposal is quite ambitious, calling for over $5 trillion in spending cuts over the next ten years. CRFB notes that, if fully enacted, the plan would put the national debt “on a clear downward path, falling from 77 percent of GDP in 2017 to 61 percent by 2027.” While we do not expect most cuts to be signed into law, the wider budget remains a useful statement of principles for House Republicans.
For tax reform, the House reconciliation instructions include specific guidelines and limitations, including a mandate that tax reform be deficit-neutral, coupled with at least $203 billion in spending cuts to reduce future deficits. Those savings are to be spread across eleven different committees of jurisdiction, encouraging wide-ranging spending reform. There is an ongoing debate within the Republican caucus on the size and scope of these cuts, and the CRFB has responded by outlining dozens of programs that could be reformed to meet the goal.
Whether the final budget resolution will require deficit-neutrality is still under discussion by lead tax reform negotiators in Congress and the White House, and the House budget resolution is still subject to a future floor vote. However, there will be intense pressure to move the tax reform process forward, even as Congress continues to debate health reform, raises the debt ceiling, and works on other issues such as reauthorizing the Children’s Health Insurance Program.
Read more about Budget Reconciliation Basics, published by American Action Forum. And to understand the ins and outs of the process read The Policy Circle briefs: U.S. House of Representatives, Explained and the U.S. Senate, Explained.
Do you have a twitter account? Follow the debate by tracking #taxreform and #budget2018. If you think there is something we should write about, be sure to tag @thepolicycircle so we can see it!
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