Status on tax reform: House GOP muscle deals to pass the budget

House Republicans are voting for a budget plan that's crucial to President Trump's large-scale tax cuts. The goal is a full rewrite of the inefficient, loophole-laden tax code in hopes of lower rates for corporations and other businesses and to spur economic growth.

Evan Vucci/AP
Rep. Kevin Brady (R) of Texas (r.), listens as President Trump speaks during a meeting with members of the House Ways and Means committee in the Roosevelt Room of the White House in Washington on Sept. 26, 2017.

Republican leaders Thursday scrambled to overcome pockets of resistance in order to muscle through a GOP budget plan that would pave the way for a 10-year, $1.5 trillion tax cut measure that's now the highest priority of President Trump and his GOP allies.

A close vote is assured amid opposition from hard-right Republicans unhappy about deficits and lawmakers from New York and New Jersey who fear the subsequent tax bill would take away a deduction for state and local taxes that's especially valuable to their constituents.

"This is a big issue and it has to be resolved," said Rep. Tom MacArthur (R) of New Jersey, who supports the deduction.

The underlying budget measure which abandons the Republican Party's longstanding battle to rein in deficits in favor of Mr. Trump's promise for "massive tax cuts."

Ways and Means Committee Chairman Kevin Brady says he'll schedule a panel debate and vote once the budget plan is safely passed, and much of the buzz in the Capitol concerned a flurry of horse trading as Republicans struggled to find ways to raise revenues to help finance cuts to individual and corporate tax rates. The goal is a full rewrite of the inefficient, loophole-laden tax code in hopes of lower rates for corporations and other businesses and a spurt of economic growth.

Mr. Brady, for instance, told reporters on Wednesday morning that he's still looking at curtailing tax-free deposits in 401(k) retirement accounts, a move that could raise revenue in the near term as retirement savings shift to Roth-style accounts that are funded with after-tax earnings. Rep. Carlos Curbelo (R) of Florida, said the move would help expand a tax credit in which the government contributes to retirement accounts for low-and middle-income taxpayers.

Trump says he opposes curbing 401(k) donations, however, which tossed a monkey wrench into the process.

"The president will get much of what he wants I think in tax reform, but we are a co-equal branch," said Sen. Pat Toomey (R) of Pennsylvania. "And we're going to write it."

Sen. Ron Johnson (R) of Wisconsin, came out squarely against reducing the cap on 401(k) contributions in an interview on CNN Thursday morning.

Key decisions about tax brackets, including a new bracket for high-income earners, remain up in the air. Outcomes on other provisions are unsettled as well, lending a sense of chaos as GOP leaders rush to fulfill a goal of passing the measure through the House before Thanksgiving.

"To do tax reform, you need money. And right now, even as we speak, they appear to be going wobbly on some of the issues they've raised with great certainty in previous weeks," said top Ways and Means panel Democrat Richard Neal of Massachusetts. "They've got a revenue problem, a real revenue problem. And you have to make some dramatic changes to benefits that people across America have come to expect and enjoy."

Republicans view passage of the tax measure as a career-defining dream, and its importance has only grown in the wake of the party's debacle on health care. But the tax plan's popularity is not a given with voters.

An Associated Press-NORC poll released Wednesday found most Americans saying Trump's tax plan would benefit the wealthy and corporations, and less than half believing his message that "massive tax cuts" would help middle-class workers.

First comes action on the GOP budget plan, which under Washington's arcane rules is nonbinding but would set up special procedures to pass follow-up tax legislation without the threat of a filibuster by Senate Democrats.

The tax cuts would add up to $1.5 trillion to the deficit over the coming decade, however, as Republicans have shelved fears about the growing budget deficit in favor of a once-in-a-generation opportunity to rewrite tax laws.

This story was reported by the Associated Press. 

You've read  of  free articles. Subscribe to continue.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to Status on tax reform: House GOP muscle deals to pass the budget
Read this article in
https://www.csmonitor.com/USA/Politics/2017/1026/Status-on-tax-reform-House-GOP-muscle-deals-to-pass-the-budget
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe