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Senate poised to pass US tax overhaul despite last-minu...



Senate poised to pass US tax overhaul despite last-minute snag

20 Dec 2017 0

by Michael Mathes The US Senate was poised to approve a sweeping tax overhaul Tuesday, putting President Donald Trump on the brink of his first major legislative victory nearly a year after he took office.

The deepest revamp of the tax code in three decades provides sweeping tax breaks to US corporations, and families at all incomes levels will see their income tax drop starting next year, with the largest benefits going to the wealthy.

But even if the Senate approves the $1.5 trillion package, Trump, who has pushed hard to get it across the finish line, will be forced to delay celebrations until Wednesday morning.

Hours earlier, the bill cleared the House of Representatives, and its Republican leaders thought their work was done. 

But a last-minute snag will force the House to vote on the package once more on Wednesday, after a Senate parliamentarian stripped out three provisions found to be in violation of the chamber’s guidelines on the kinds of legislation that can pass the Senate with just a simple majority.

The Senate vote was headed to a showdown. But Republicans, who hold a 52-48 majority, appeared to have enough support after holdouts against the measure, including Senator Bob Corker and Senator Marco Rubio, backed off their threats to defect.

With Senator John McCain, who has brain cancer, announcing he will not return to Washington until January, the Republican cushion sits at just one, and no Republicans are publicly opposed.

In the House, 12 Republicans joined all Democrats in opposition as the bill passed 227 to 203, drawing loud cheers and applause from Republicans in the chamber.

“Today we are giving the people of this country their money back,” House Speaker Paul Ryan told his colleagues.

Trump tweeted his congratulations to Ryan and all other “great House Republicans who voted in favor of cutting your taxes!” 

The procedural snafu only became apparent afterward. 

– ‘Mad dash’ -Senate Democrats said they demanded that three provisions in the bill, including one allowing the use of savings accounts for home-schooling expenses, be stripped out because they violate the Senate’s so-called Byrd Rule.

Democrats seized on the hiccup as proof that Republicans were rushing to jam the tax cuts through Congress without allowing lawmakers, the public and financial experts to do a deeper dive on the impacts of the bill.

“In the mad dash to provide tax breaks for their billionaire campaign contributors, our Republican colleagues forgot to comply with the rules of the Senate,” senators Bernie Sanders and Ron Wyden said in a statement.

Republican leaders unveiled their final version of the bill only late last week, and Trump has demanded it be on his desk by Christmas.

Should the Tax Cuts and Jobs Act make it into law it would be the Republicans’ first major legislative victory in the 11 months since Trump’s inauguration.

The Republican plan is projected to add nearly $1.5 trillion to the national debt over the coming decade, according to the Joint Committee on Taxation. 

But that figure drops to about $1 trillion when economic growth is accounted for.

Ryan stated that a median-income family of four earning $73,000 annually would save $2,059 in taxes next year.

– ‘Moral obscenity’ -The Democratic opposition has denounced the measure as mostly benefiting companies and the wealthiest Americans — including Trump himself — and warns it risks blowing a hole in the national debt, which has surged past $20 trillion.

White House press secretary Sarah Sanders asserted that the new bill “could cost the president a lot of money,” but she conceded that “on the business side he could benefit.”

While Republicans failed earlier this year to repeal and replace Obamacare, the tax plan takes a key step in that regard, by scrapping the individual mandate that requires nearly all Americans to have health insurance or pay a fine.

Under the legislation, the federal corporate tax rate would fall from 35 percent to 21 percent, and the maximum individual income tax rate, for the nation’s wealthiest, would drop from 39.6 percent to 37 percent.

The bill also doubles the standard deduction for families, and doubles the child tax credit.

But it also provides clear advantages for the wealthy, including a doubling of the amount of money that can be exempted from inheritance tax.

Top House Democrat Nancy Pelosi called the bill a “moral obscenity,” and “brazen theft from the American middle class.” DM


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