Article: Senate approves $1.4 trillion tax cut; final negotiations with House looming
By David Sherfinski – The Washington Times – Saturday, December 2, 2017
Saying a flawed deal was better than no deal at all, Senate Republicans rallied around their leadership Saturday morning and voted to approve a $1.4 trillion tax-cut package, taking the biggest step yet toward delivering a tax code overhaul to President Trump this year.
The bill, which passed on a 51-49 vote, came together after Republicans cut deals with a handful of reluctant senators. Vice President Mike Pence took the presiding officer’s chair to gavel the vote closed just before 2 a.m.
GOP leaders said the bill delivers across-the-board tax relief for individuals, while slashing the corporate tax rate will help spur economic growth to make up for the bill’s hefty price tag in the long run.
“This is a big moment for American families and small businesses ready to turn the page on an Obama-era recovery that has been far too sluggish,” said Sen. John Cornyn of Texas, the second-ranking Republican in the chamber.
Sen. Bob Corker of Tennessee was the only Republican to join Democrats in opposing the bill, saying he felt it did too much damage to the government’s budget, leaving too much debt.
He’d been pushing for a deficit “trigger” to be added that would have curtailed the tax cuts if the economy didn’t grow as much as the GOP hoped. But leaders had to jettison that idea after the Senate parliamentarian said it likely violated budget rules.
Deals were instead cut to increase benefits for small businesses and to partially restore a property tax deduction, winning over both conservative and moderate senators. To pay for those changes, GOP leaders had to scale down their plans to cut the Alternative Minimum Tax for corporations and individuals.
The AMT is a parallel tax system created in 1969 to target very wealthy individuals, and Republicans had billed its planned repeal as a prime example of how their plan would simplify the tax code.
The revised plan also increases the rates at which foreign earnings parked offshore would be taxed to more closely mirror the House’s plan. That move generated close to $100 billion — about the cost of the change to expand the deduction for smaller “pass-through” companies that file their taxes as individuals.
Smaller goodies were also written into the bill, including one provision to carve Hillsdale College out of the new excise tax on school endowments. Hillsdale refuses government aid, and Republicans said because of that it shouldn’t face the tax that other schools face.
But a handful of Republicans joined with Democrats to kill the carveout in a 52-48 vote.
It was a rare victory for Democrats, who saw amendment after amendment shot down by a mostly unified GOP.
Senate Minority Leader Charles E. Schumer called the bill “such a monstrosity and such a danger to the country.” He said the GOP will pay at the polls in 2018, and for years to come.
“The Republican Party will never again be the party of tax cuts for the middle class,” the New York Democrat predicted. “With the passage of this tax bill, today will be the first day of a new Republican party – one that raises taxes on the middle class, abandoning its principles for its political paymasters.”
GOP leaders were making changes to the bill up to the very last moment Friday, infuriating Democrats who said nobody knew what they were even voting on.
But they’ll have a chance to dig through the details as the Senate plan gets reconciled with the version the House passed in November.
Both plans bring down the corporate tax rate from 35 percent to 20 percent, and cut the income tax rates most individuals pay, while weeding out various exemptions and deductions.
The bills differ on some major points, though, including the Senate bill’s including of a repeal of Obamacare’s individual mandate.
One chamber could simply choose to accept the other’s bill and send it to Mr. Trump’s desk, but senators said Friday that they expect a bicameral conference committee to work out the differences.
House Speaker Paul D. Ryan also said Thursday that the bill will go to conference.
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