US Treasury urges Congress to raise debt limit before August recess

Treasury Secretary Steven Mnuchin urged members of Congress Wednesday to increase the US debt ceiling before taking their August recess, as the Trump administration warned that tax receipts were coming slower than expected.

Within hours, the conservative House Freedom Caucus said it would oppose such a vote unless certain conditions are met. It had been expected that Congress wouldn't have to act on the politically painful measure until sometime this fall, but tax revenues are coming in lower than previously estimated.

Mnuchin previously said the deadline to raise the limit and avert a default on US debt would come some time during the fall.

"We look forward to working with the Hill on the best way to go about this", he said.

"My understanding is that the receipts now are coming in a little bit slower than expected and you may soon hear from Mnuchin regarding a change in the date", Mulvaney said at a separate House hearing. The amount of outstanding debt subject to limit has now risen to about 19.9 trillion US dollars.

Mulvaney said the Trump administration has no position yet on whether it would prefer the debt ceiling be increased to a set dollar amount or the limit be suspended through a date in the future.

Mnuchin has urged lawmakers to move quickly to remove investor doubt about any potential default. The agency began employing emergency measures to avoid breaching the federal borrowing limit in March.

House staffers and lawmakers are expecting a lively debate at the Ways and Means Committee's second tax reform hearing May 23, this one about the border adjustment tax.

  • Zachary Reyes