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Boehner's Counteroffer Might Not Violate Tax Pledge

Bill Clark/CQ Roll Call

So, does Speaker John A. Boehner’s offer of $800 billion in new tax revenue violate his pledge not to raise taxes?

It’s part of a broader question that Americans for Tax Reform President Grover Norquist doesn’t like to talk about: Can a pledge-signer let taxes go up and still comply with the no-new-taxes pledge?

So far, Norquist hasn’t issued a ruling on the Boehner offer, but in the past, he has acknowledged that there are ways to let tax increases happen without falling afoul of the pledge — and Boehner’s offer could easily be interpreted as complying.

Norquist, in an interview on MSNBC on Tuesday, dodged whether Boehner’s offer violates the pledge.

“We really have to see it written down,” Norquist said. “You have to look at the whole package.”

Norquist, however, has tried to keep his pledge, and the rules for it, hazy. It’s not in his interest to point out its loopholes.

It seems like a paradox, but Norquist himself has held that allowing the Bush-era tax cuts, alternative minimum tax relief and other provisions to expire — and, in effect, jumping off the fiscal cliff — would not violate the pledge.

“If there were no vote in Congress and taxes rose automatically, then no politicians would have voted for higher taxes and no elected official would have broken his or her pledge,” Norquist wrote last year in The New York Times.

So, ironically, Republicans can allow what would be one of the biggest tax increases in American history by triggering the fiscal cliff without falling afoul of an anti-tax pledge.

That’s part of the thinking behind the suggestion earlier this year by Sen. Patty Murray, D-Wash., that Republicans would have an easier time cutting a tax deal after Jan. 1.

But there’s nothing magical about the Jan. 1 date. Temporary tax breaks expire all the time, and Norquist hasn’t labeled Republicans who failed to extend them as pledge breakers.

Why would that somehow apply to expiring tax breaks for the wealthy?

Turns out, there is precedent for letting tax breaks for the wealthy expire and still winning Norquist’s blessing. At the end of 2010, Republican lawmakers cut a deal that restored 2009-level estate tax rates in 2011 and 2012. In 2010, the estate tax rate was zero. Under the 2010 lame duck tax deal endorsed by Republican leadership, the estate tax rate rose from nothing to 35 percent. But the rate would have risen even higher without the deal.

That’s the kind of thinking behind Rep. Tom Cole’s reasoning in a recent Politico interview, when he suggested that House Republicans pass an extension of tax cuts for the middle class right away. The Oklahoma Republican contended that passing middle-class tax cuts now would not violate the pledge even if those for the wealthy separately expire, and Norquist has not disputed Cole’s assertion.

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