Treasury Secretary Steven Mnuchin spent most of his time during a Senate Finance Committee hearing called to discuss President Donald Trump's 2019 budget fielding questions on the tax cuts enacted last year.
Republicans, including Committee Chair Sen. Orrin Hatch of Utah, focused on the growth forecasts indicated in the administration's budget and how the tax cuts would help support those predictions. Democrats, including Ranking Member Ron Wyden of Oregon, pressed Mnuchin on the number of share buybacks announced by corporations in light of tax reform as compared to what they viewed as minuscule benefits for average workers.
"Wages will increase, and we expect that over the course of this year," Mnuchin told the committee, adding that all wage boosts won't materialize immediately after the bill became law. He later added that the Treasury anticipates roughly 90% of U.S. workers will see their tax withholding changed to their benefit by the end of February, given that the IRS has released withholding tables to account for the changes in the tax law.
Mnuchin confirmed that an increase of 2.3% to 2.4% in tax collections would make the rate cuts revenue neutral. On the corporate end of the tax spectrum, Mnuchin defended corporate share buybacks by calling them "a healthy thing."
Democrats also focused on Russian sanctions and potential infrastructure investment and financing. Senators Ben Cardin of Maryland and Claire McCaskill of Missouri pressed Mnuchin on the administration's efforts to take action against Russian oligarchs and whether President Trump is actively engaged in penalizing the country.
When asked by McCaskill if Trump ever asked Mnuchin to impose sanctions on Russia, Mnuchin said, "I told him we would be doing sanctions against Russia, and he was pleased to hear that."
Near the close of the hearing, Wyden shifted the discussion to infrastructure. He asked if the administration supports local governments raising taxes to pay for infrastructure projects two months after the tax law eliminated the state and local tax deduction commonly used by residents of high-tax states like New York, New Jersey and California.
"Not every single state is the same," Mnuchin said to Wyden. "Some states have very high taxes like California and New York, so I surely would not encourage California and New York to raise their taxes."