Senate to delay corporate tax cut, breaking with Trump and House
Reported By Brett Samuels and Jordain Carney – 11/09/17 11:54 AM EST
Senate Republicans plan to propose delaying a cut in the corporate tax rate until 2019, according to a GOP senator.
Sen. Bill Cassidy (R-La.) also said the individual mandate will not be repealed as part of the Senate tax overhaul proposal expected to be released Thursday.
The proposal breaks with President Trump’s preference that a corporate tax cut be put in place immediately. The House’s tax-reform legislation proposes lowering the corporate tax rate from 35 percent to 20 percent in 2018.
Other big changes from the House version include adding back in a deduction for medical expenses and a full repeal of state and local tax deductions.
Republicans are seeking to get a bill to President Trump’s desk by Christmas.
A House panel could report its version out of committee on Thursday, and that measure could get a vote in the full chamber next week.
The GOP-written legislation is not likely to win over any Democrats, who blast it as a giveaway to the rich and object to cutbacks in breaks used by the middle class. Republicans say their standard deduction increase and tax rate cuts will make up the difference.
This story has been updated.
Blue Dog Democrats taking hard line on GOP tax bill
Reported By Mike Lillis – 11/09/17 06:00 AM EST
Blue Dog Democrats are lining up in firm opposition to the Republicans’ tax code overhaul, hoping that Tuesday’s election results will force GOP leaders to reach across the aisle for a bipartisan alternative.
The Blue Dogs had initially expressed an eagerness to join Republicans in the push for sweeping tax reform, which stands among the GOP’s top priorities. But the fiscally minded Democrats are quickly racing away from the GOP proposal, largely over projections the bill will hike taxes on millions of middle-class families and lead to a spike in deficit spending.
“Let me just be quite honest,” said Rep. David Scott, a Georgia Blue Dog. “There is no way I can support it.”
Behind Rep. Kevin Brady (R-Texas), chairman of the Ways and Means Committee, the Republicans are pressing forward this week with the marathon markup of their partisan tax proposal. The Republicans, desperate for a major legislative victory following the embarrassing demise of ObamaCare repeal earlier in the year, are scrambling to move the tax bill through the House by Thanksgiving and to President Trump’s desk by Christmas.
But overhauling the nation’s convoluted tax structure is a colossal task — there are reasons Congress hasn’t enacted major tax reforms since the Reagan administration — and the Republicans are facing stiff headwinds from a long list of opponents, including small business groups, realtors, universities and deficit hawks, not to mention Democrats united against the plan.
The blowback has made even some Republicans skeptical they can enact the conservative tax overhaul that’s long been at the top of Speaker Paul Ryan’s (R-Wis.) wish list.
With that in mind, the Blue Dogs sense an opening for bipartisan compromise, and they’re feeling empowered by Tuesday’s elections, which saw lopsided Democratic victories in state and local contests across the country.
“It shows that we’ve got juice, and if they want to maintain their majority — or at least come close to that in the next cycle — they’re going to have to work with Democrats like us,” said Rep. Kurt Schrader, an Oregon Blue Dog.
“The mood of the country’s moving away from them. They’ve not shown that they can get anything done. People are tired of that; they want someone who’s going to work across the aisle, someone who can solve problems.”
Scott agreed, saying the elections should stand as “a wake-up call” for both parties.
“It’s a powerful lesson, and it puts a greater pep in the step of Democrats,” he added. “But we’ve got to be willing to reach across the aisle.”
The Blue Dogs have dwindled in numbers since a rout in 2010, and there are now fewer than 20 members.
And it’s not even clear that Republicans are ready to reach across the aisle simply based on Tuesday’s results. Just a handful of GOP members have come out against the tax bill thus far, and many Republicans expect an easy vote on the House floor next week.
And not all Democrats are so eager to work with the Republicans on the tax plan, which was written with no help from the minority party. Indeed, in the eyes of many Democrats, Tuesday’s election trouncing was largely a reflection of the Republicans’ failure to enact any of their big campaign promises, despite controlling all the levers of power in Washington.
With that in mind, many Democrats see political gold in uniting to deny the Republicans a victory on tax reform, whatever form it assumes.
“The Democratic Party is going to be united,” Rep. Steny Hoyer (Md.), the Democratic whip, told reporters Tuesday. “If we held the vote today, we would be united. And I expect overwhelming Democratic opposition to a bill that advantages greatly the wealthiest in America and leaves the middle class behind.”
It remains unclear if the Republicans will need any Democratic votes to pass a tax package, with only several members peeling off thus far. And although they’ve sprinkled notions of seeking bipartisanship, Republicans wrote the bill themselves and Democrats say they are jamming it through with no hearings.
And if the criticism coming from the Blue Dogs this week is any indication, the GOP bill needs plenty of work if it’s to win the Democrats’ support.
“It will increase the taxes on the middle class and give extraordinary tax cuts to the wealthiest people,” said Scott. “And you and I both know that it is the middle class, it is the lower-income [people] … that will spend the money.
“Giving these tax cuts to the wealthy, they hoard it.”
Echoing Scott, Rep. Sanford Bishop, another Georgia Blue Dog, ticked off a long list of deductions eliminated under the GOP plan he said Democrats can’t support. As one example, “it seems awfully ridiculous for a school teacher not to be able to deduct the pens and the pencils and the papers that she purchases for her children,” he said, “but a corporation can deduct all of the pens and supplies that they provide to their employees.”
The Blue Dogs also oppose new deficit spending proposed under the GOP’s plan — a figure that would reach $1.7 trillion over the next decade, the Congressional Budget Office estimated Wednesday.
“It’s complete hypocrisy that Republicans are ignoring that at this point,” Schrader said. “You’d have to close that hole dramatically.”
But Schrader also praised certain elements of the Republican plan, and predicted the GOP was going to need their help.
“They’re going to be desperate,” he added.