After hitting a few bumps in the road, the Republican tax bill finally seems to be gaining the momentum needed for passage by the end of the year, and GOP leaders are “confident” that the needed votes are finally there.
“I’m confident we’ll have the votes,” Ohio Senator and tax conference member Rob Portman said, according to CNN.
House Ways and Means Chairman Kevin Brady is also feeling good about the bill’s prospects, saying, “I’m confident at the end of the day, the Senate will approve this conference committee report.”
Their optimism comes from the removal of several key GOP obstacles to the bill’s passage.
Maine Senator Susan Collins, who had previously been undecided, signaled support for the bill and her approval that it includes three amendments she asked for, CNN reported.
“Americans deserve a tax system that is fair, simple, and promotes economic growth,” Collins said. “I am pleased that the final tax reform bill includes all three of the amendments I authored, along with a number of provisions for which I strongly advocated, that will benefit lower- and middle-income families.”
Initially unhappy with the child credit, Florida Senator Marco Rubio, South Carolina’s Tim Scott, and Utah Senator Mike Lee are now on board after getting key compromises.
The increased Child Tax Credit, along with the strong pro-growth, pro-American jobs provisions already contained in the legislation, makes me an enthusiastic YES vote for the Tax Cuts and Jobs Act. Thank you to @MikeLeeforUtah, @votetimscott and @IvankaTrump for their leadership. pic.twitter.com/w3fS4kMHv1
— Marco Rubio (@marcorubio) December 16, 2017
Worked with @marcorubio to ensure the Child Tax Credit will help families even more in final tax reform package. Boosting refundability will help so many hardworking families, and Marco's efforts have been invaluable on this. #taxreform
— Tim Scott (@SenatorTimScott) December 15, 2017
Even Tennessee’s Bob Corker is set to support the plan.
The GOP has a narrow majority that is set to become even narrower in January when Democratic Alabama Senator-elect Doug Jones is sworn in, but it hopes to pass the bill before that happens.
What is in the bill? CNBC reports from the Republican summary:
The proposal would maintain seven individual income tax brackets at slightly different rates: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37 percent. The top rate would fall from the current 39.6 percent. The House originally proposed collapsing the system to four brackets, saying it would simplify the filing process. The changes would phase out after 2025.
The bill would scrap the personal exemption but increase the standard deduction to slightly less than double its current level. It would go to $12,000 for an individual or $24,000 for a family.
It would drop the corporate tax rate to 21 percent from the current 35 percent. The change would take effect next year.
The plan would set a 20 percent business income deduction for the first $315,000 in income earned by pass-through businesses.
The bill would scrap Obamacare’s provision that requires most Americans to buy health insurance or pay a penalty, beginning in 2019. Doing so is projected to lead to 13 million fewer people with insurance and raise average Obamacare premiums, according to the nonpartisan Congressional Budget Office.
The plan would eliminate the corporate alternative minimum tax, which the Senate added back to its plan at the last second to raise money. House leaders and corporate groups said the tax would stifle research and development. It would also increase the exemption from the individual AMT.
The estate tax, or so-called death tax, would remain but the exemption from it would be doubled.
The child tax credit would double to $2,000 per child from $1,000. It would be refundable up to $1,400 and start to phase out at $400,000 in income. The tweak would end after 2025.
The plan would limit state and local tax deductions. It would allow the deduction of up to $10,000 in state and local sales, income or property taxes.
It will not change the mortgage interest deduction for existing homeowners. For new homes, taxpayers can deduct interest on up to $750,000 in mortgage debt, down from $1 million currently.
Tax breaks for charitable contributions and retirement savings plans would remain.
The bill would not include the controversial first in first out stock sales change, which sparked backlash in the investing community.
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Any op-ed views and opinions expressed are solely those of the author and do not necessarily represent the views of BizPac Review.
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