WASHINGTON -- Republican lawmakers Friday said they had secured the votes of two high-profile holdouts for their tax overhaul plan, putting them closer to their first significant legislative victory this year.
GOP leaders hope to pass their $1.5 trillion tax cut along party lines and send it to President Donald Trump by Christmas.
On Thursday, the bill's fate seemed uncertain, when Sen. Marco Rubio of Florida objected to the size of the bill's child tax credits, and Sen. Bob Corker of Tennessee expressed concern about the plan's effect on the U.S. deficit.
But on Friday, Rubio said a revised, more generous child tax credit had won his support, and Corker said he would vote for the legislation despite the cost of the tax cuts.
"This is happening. Tax reform under Republican control of Washington is happening," House Speaker Paul Ryan of Wisconsin told rank-and-file members in a conference call. "Most critics out there didn't think it could happen. ... And now we're on the doorstep of something truly historic."
On Friday, Republicans released details about the overhaul plan and later unveiled the 1,097-page bill. The compromise measure provides deep and long-standing tax cuts for businesses, while providing slightly more generous tax breaks for low- and middle-income Americans by reducing some benefits for higher earners.
New details show that lawmakers offset last-minute changes to the bill -- such as eliminating the corporate alternative minimum tax and lowering the top individual tax rate to 37 percent from the current 39.6 percent -- through slight adjustments, not big changes.
It was still unclear how Republicans plan to pay for the entire package, which must add no more than $1.5 trillion to the deficit if it is to pass without Democratic support.
Despite the bill's $1.5 trillion price tag, Corker, a longtime deficit hawk, said he was swayed to support the bill after "many conversations over the past several days with individuals from both sides of the aisle across Tennessee and around the country."
Corker deemed the bill far from perfect but said it was a once-in-a-generation opportunity.
"I realize this is a bet on our country's enterprising spirit, and that is a bet I am willing to make," Corker said.
A preliminary deficit estimate for the final version of the GOP tax bill indicated it would add $1.46 trillion to the budget deficit over the next 10 years. The Joint Committee on Taxation's analysis combines revenue losses from rate cuts with tax increases from repeal of deductions and other preferences.
Rubio relented in his opposition after negotiators expanded the child tax credit, and a spokesman for Rubio said the senator will vote yes on the legislation.
Rubio had been holding out for a bigger child tax credit for low-income families. After he got it, he tweeted that the change was "a solid step toward broader reforms which are both Pro-Growth and Pro-Worker."
The tax package would double the basic per-child tax credit from $1,000 to $2,000. The bill makes a smaller amount available to families even if they owe no income tax. That amount was increased to $1,400 from the $1,100 level of an earlier version of the bill.
Low-income taxpayers would receive the money in the form of a tax refund, which is why it's called a "refundable" tax credit.
The bill's text, which was signed by Republican negotiators from the chambers' conference committee Friday, includes few major changes from the version that passed in the Senate earlier this month. The 2025 expiration date for the individual tax cuts remains, as does the estate tax, which would apply to fewer Americans in the future.
At the center of the $1.5 trillion bill are large tax cuts for corporations and other businesses, which Republican lawmakers say will create jobs, investment and economic growth.
Compared with the Senate bill, the revised legislation would lower some thresholds for entering a higher individual marginal tax bracket. For example, the top bracket for a married couple filing jointly would begin at $600,000 a year, down from $1 million in the Senate bill.
Owners of pass-through businesses, who pay taxes on their profits at the owners' individual tax rate, would receive a slightly less generous tax break than the original bills called for, allowing a 20 percent deduction on profits they earn. That deduction would phase out -- with some exceptions -- starting at $315,000 of income for couples. The Senate bill included a larger deduction, 23 percent, and a higher phaseout point, $500,000 for couples.
Two newly revealed changes on the business side would help offset revenue losses: a provision that would allow corporations to deduct 80 percent of their net operating losses in the future, down from 90 percent in the Senate bill, and one that would effectively reduce the annual value of research and development tax breaks starting in 2022.
In changes revealed earlier this week, the bill would reduce the corporate tax rate to 21 percent from the current 35 percent; the Senate and House bills had lowered the rate to 20 percent. It also allows taxpayers to deduct up to $10,000 a year in state and local taxes -- a mix of property taxes and either income or sales taxes paid -- in a bid to blunt tax increases on higher-earning workers in high-tax states such as New York and California.
Additionally, the bill repeals the Patient Protection and Affordable Care Act's mandate that most Americans have health insurance or face paying penalties.
The House and Senate plan to vote on the tax bill next week. Many of the bill's changes -- lower tax rates and fewer deductions -- will go into effect in January.
Rep. Kevin Brady, chairman of the tax-writing Ways and Means Committee, predicted that the Senate would not end up being a roadblock for the tax overhaul.
"I'm confident, at the end of the day, the Senate will approve this conference committee report," the Texas Republican said.
Still 3 GOP holdouts
While the bill appeared to be heading toward the finish line, at least three other Republican senators remained publicly undecided on it Friday. Republicans hold a slim 52-48 majority in the Senate.
Those undecided include Mike Lee of Utah, who has allied with Rubio in pressing for an expanded child credit, and Jeff Flake of Arizona, who has been trying to extract commitments from Republican leadership related to the Deferred Action for Childhood Arrivals program for now-illegal aliens who were brought to the U.S. as children.
Sen. Susan Collins of Maine also has expressed reservations about the bill's reduction in the top individual tax rate and pushed for party leaders to support measures to bolster individual health care markets as a condition for her vote. Collins' office said Friday afternoon that she had not yet seen the final bill.
A spokesman for Flake said the senator remains undecided.
Lee, in a statement, sounded upbeat about the bill, saying Rubio and other senators "have done a tremendous job fighting for working families this week, and they have secured a big win." He added: "I look forward to reading the full text of the bill and, hopefully, supporting it."
Meanwhile, two ailing senators have missed votes this week.
John McCain of Arizona, who is 81, is in a Washington-area military hospital being treated for the side effects of brain cancer treatment, and 80-year-old Thad Cochran of Mississippi had a nonmelanoma lesion removed from his nose earlier this week. GOP leaders are hopeful they will be available to vote next week.
Trump, when asked about Lee and Rubio on Friday, said he had no concerns about their support.
"I think they'll be great," he said. "They're great people. They want to see it done. I know them very well. I know how they feel. These are great people, and they want to see it done, and they want to see it done properly."
Trump also told reporters that he had seen the bill, and he liked it.
"I have seen it," Trump said in brief remarks at the White House. "I think it's going to do very, very well. I think that we are going to be in a position to pass something as early as next week, which will be monumental."
Democrats, meanwhile, are expected to unanimously oppose the legislation.
"Under this bill, the working class, middle class and upper middle class get skewered while the rich and wealthy corporations make out like bandits," said Senate Minority Leader Charles Schumer of New York. "It is just the opposite of what America needs, and Republicans will rue the day they pass this."
Information for this article was contributed by Jim Tankersley and Thomas Kaplan of The New York Times; by Damian Paletta, Erica Werner, Jeff Stein, Mike DeBonis and Heather Long of The Washington Post; and by Stephen Ohlemacher and Marcy Gordon of The Associated Press.
Michael Evans, chief counsel for the Senate Democratic tax conferees, waits outside the office of House Ways and Means Committee Chairman Kevin Brady of Texas on Friday in hopes of monitoring the Republicans’ process on a conference report to advance their tax overhaul plan, but he was turned away.
A Section on 12/16/2017
Print Headline: GOP tweaks tax bill, wins over 2 senators