The massive fiscal legislation passed in the House last week would permanently lower individual income tax rates, giving Republicans a major advantage in their decadeslong tax war. 

Former President George W. Bush implemented tax cuts, but they were only temporary. The individual tax cuts that President Donald Trump enacted in 2017, too, were temporary and are scheduled to expire at the end of this year. 

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But the One Big Beautiful Bill Act would mean the lower tax rates never expire. Most notably, the top rate on individual income would be 37% indefinitely. 

Liberal Democrats have long called for raising tax rates on top incomes. But doing so is not easy. Former President Joe Biden could not secure tax rate hikes despite having majorities in both chambers. Former President Barack Obama presided over an increase in the top rate, but only because the Bush tax cuts expired. The last president to sign legislation raising tax rates on labor income was former President Bill Clinton in 1993. 

Rep. Jason Smith (R-MO), the House Ways and Means Committee chairman responsible for writing the tax bill, said he hoped that having the lower rate firmly ensconced in law would help prevent future upward revisions by Democrats. 

“But expect the unexpected when it comes to the Democrat party,” he told the Washington Examiner Friday. “They have never found a tax increase that they don’t like, so I think that they would aggressively — if they had control of the House, the White House and the Senate — I think they would try to make sure that Americans pay more of their hard earned dollars to the federal government.”

Longtime antitax activist Grover Norquist noted that since 1994, when Republicans signed a pledge not to raise taxes, Democrats have had control of the House and Senate for just six years, while Republicans have controlled both chambers for 18 years.

Norquist told the Washington Examiner that making the individual rates permanent would help prevent Democrats from forcing tax hikes in the future as part of a compromise with Republicans to extend expiring tax cuts. 

“We don’t want to have to do that again,” said Norquist, the president of Americans for Tax Reform. “We need to have pro-growth policies that workers, and employers, and investors all know are there for decades into the future.”

“What we used to do is Republicans would cut taxes, Democrats would take it away, and Republicans have to come back and cut taxes again,” Norquist said. “They’re not going to be able to take it away in the same zone, because they have to have all three parts of the government.”

Peter Loge, director of the George Washington University School of Media and Public Affairs, said that it would be a heavy lift for Democrats to raise taxes unless they only apply to the very wealthy.

“I think politically, it’s hard to raise taxes in general, so even if Republicans only have the tax cuts extended temporarily, in reality, when they expire, it’s very difficult to let them expire,” Loge told the Washington Examiner.

“So they’re de facto permanent, even if not de jure permanent,” he added.

Biden was prevented from raising tax rates by centrist Democratic senators, notably Joe Manchin of West Virginia and Kyrsten Sinema of Arizona, who opposed them on the grounds that they would hurt business. 

Obama saw the top individual tax rate rise to 39.6% as part of the American Taxpayer Relief Act, which resolved the “fiscal cliff” facing the government with the expiration of the Bush tax cuts in 2012. That bill got a number of Republican votes in large part because it extended the Bush tax cuts for lower-income brackets. 

In the following years, the Democratic Party became even more amenable to taxes on the wealthy, thanks to rising liberal concern over income inequality. The slow economic recovery from the financial crisis and the publication of Thomas Piketty’s Capital in the Twenty-First Century generated enthusiasm for populist measures, as did Sen. Bernie Sanders’ (I-VT) surprisingly strong Democratic presidential primary campaign in 2016. 

Yet, the swell of support for soak-the-rich measures failed to yield rate hikes under unified Democratic control of the government in 2021, and Trump’s victory in the 2024 election ensured that Democrats would not be able to allow the Trump tax cuts to expire. 

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Still, Michael Graetz, a professor of tax law at Yale Law School and the author of The Power to Destroy: How the Antitax Movement Hijacked America, noted that the top rate has fluctuated between 39.6% and 35% since 1993. The narrow range, he told the Washington Examiner, “makes it impossible to believe the choice has any impact on economic growth.”

“But nothing is permanent in the tax law, least of all the rates,” Graetz concluded.