Hope for tax bill by Christmas rests on House GOP plan
Republican lawmakers reveal key details of bill, delay unveiling until Thursday amid last-minute disagreements
It appears the House Republican leadership has made progress on a number of key challenges facing its tax plan, making a compromise to preserve a top individual tax rate of 39.6%, while dropping the corporate tax rate to 20%.
Those decisions, revealed to the Wall Street Journal by sources familiar with the matter, would be selling points for the bill which the president has said would not benefit the country’s most affluent and would focus on boosting the economy. The proposal also delays a cut to the estate tax, which along with the top individual tax rate cut was criticized as contrasting Trump’s claims that the bill would aim to help middle class and lower income Americans.
But despite the compromise on these issues, which would help minimize the lost revenue, Republicans are still having trouble coming to agreement on some other potential ways to pay for the tax cuts. After House Ways and Means Committee Chairman Kevin Brady told reporters the bill would be released on Wednesday, lawmakers delayed the unveiling until Thursday.
Brady himself is at the center of one issue of contention, defying the president and other lawmakers by calling for limitation to popular 401(k) retirement plans to be part of the bill, as Politico reports.
The decision to drop the corporate tax cut to 20%, would lay to rest speculation that the bill might phase in that rate cut as a way to soften the blow to revenue. Trump has expressed his opposition to phasing in those cuts, seen as integral to giving a boost to the economy. Some see a move to delay the cuts as threatening the Republicans chances of maintaining a majority in midterm elections.
The takeaway from the flurry of news surrounding the GOP efforts on tax reform is that failure to pass some form of tax legislation this year presents an existential threat to Republicans’ grip on Congressional power. As such it is hard to imagine they will not find a way to pass something. And yet the number of sticking points, illustrated by the delay in releasing the plan this week, and the limited time before winter holidays means anything could happen.