A lot of Republicans in Congress cite the Tax Reform Act of 1986 as a model for the tax plan they hope to implement in the next few months. They lament the fact the tax code hasn’t been overhauled in 31 years, and say they want to do it again.
But there are three very large and important differences between the 1986 reforms and the plan Republicans are considering today.
I’d note, Republicans and Democrats also spent about two years putting the 1986 tax plan together before they got it enacted. It took a lot of negotiation and planning to build enough support to pass a plan that eliminated lots of deductions and exemptions to pay for lower tax rates.
The more common model for single-party tax policy changes, like Bill Clinton’s tax increase in 1993 and George W. Bush’s tax cuts in 2001, is to make modest changes to tax rates and deduction and credit amounts within the existing tax framework. This approach means you don’t have to fight so many interest groups at the same time you fight the other party.
What Republicans have proposed to do is really hard — much harder than what Reagan, Clinton, or Bush got done on taxes. And Trump does not seem to have the legislative acumen of those prior presidents, either.