Cowen has a note this morning saying the path ahead for tax legislation has grown more muddled in the past two weeks as Republicans tie themselves in knots over how to proceed with Obamacare repeal/replace/repair. Analyst Chris Krueger lays out the five now likely scenarios on taxes:
- Tax overhaul following GOP's "Better Way" plan including border adjustment (note: border-tax opponents have been winning lately)
- Rehash of the George W. Bush tax cuts with a 10-year sunset
- Combination of Obamacare and taxes in one giant bill
- Nothing
- A "Middle of Road" tax and infrastructure bill
The easiest route is #2 to get a tax-cut win and deal with the cost later. Krueger calls it the "In Emergency, Break Glass Option."
The more the legislative process breaks down on Capitol Hill, the more likely we suspect this option heads to the very top of the probability list ... Everyone is waiting to get ObamaCare off the mat and Trump to get in the ring.