[NFBMT] From the New York Times

Sat Dec 16 10:28:38 UTC 2017

Republicans' $1.5 Trillion Tax Plan Appears on Track to Pass Next Week

December 15, 2017

WASHINGTON - Republican lawmakers appeared to secure enough votes on Friday
to pass the most sweeping tax overhaul in decades, putting them on the cusp
of their first significant legislative victory as leaders geared up to pass a
$1.5 trillion tax cut along party lines and send it to President Trump by
Christmas.

A day after the bill's prospects wavered somewhat, Republican leaders notched
two victories on Friday, when Senator Marco Rubio of Florida said he would
vote yes after gaining a more generous child tax credit in the final bill and
Senator Bob Corker of Tennessee, who voted against the initial Senate bill
over deficit concerns, said he would support the legislation. The bill also
won praise from Senator Susan Collins of Maine, leaving it likely to pass
with all 52 Senate Republicans in support.

The final legislation released by Republicans on Friday follows the broad
strokes of the previous House and Senate bills, providing deep and
longstanding tax cuts for businesses, including a corporate tax rate of 21
percent, down from the current 35 percent. The bill also provides temporary
tax benefits for low- and middle-income Americans, including lower marginal
tax rates, and a new top tax rate of 37 percent for the wealthiest Americans,
down from 39.6 percent. All of the individual tax breaks will expire at the
end of 2025.

The final bill does build back in some of the prized tax breaks that had been
slated for elimination in the House legislation, including the deduction for
high out-of-pocket medical costs, tax-free tuition waivers for graduate
students and the ability to deduct interest on student loans. But it also
includes new limits on other popular tax breaks, including the mortgage
interest deduction and the state and local tax deduction.

In a pre-emptive move against accounting maneuvers in high-tax states such as
New York and California, the bill prohibits taxpayers from prepaying next
year's state and local income or property taxes, in order to deduct them from
2018 taxes. That form of tax planning would have allowed taxpayers to benefit
more from the full state and local deduction this year before it is capped
next year.

The bill also includes changes large and small to appease business lobbyists
and their congressional champions, such as additional tax relief for the
owners of engineering and architectural firms and the elimination of a change
in capital gains treatment of homes sales - a key priority for the real
estate industry.

One of the biggest changes came on Friday, when lawmakers agreed to a demand
by Mr. Rubio to expand the child tax credit by allowing families who owe no
federal income taxes to still claim up to $1,400 of the $2,000 child tax
credit, up from $1,100 in the original version. But that change was offset by
limiting the bill's benefits to some higher-income families, and by
restricting it to children age 16 and below, down from 17 and below in the
Senate bill. The net result was a credit that is more lucrative for
lower-income earners but actually slightly less costly than the Senate bill.

Republicans must stay within a $1.5 trillion limit that lawmakers have
allowed on the amount the bill can add to federal deficits if they want to
pass it without Democratic support.

The bill's price tag had been a sticking point for one senator, Mr. Corker, a
longtime deficit hawk, who voted against the initial Senate bill over
concerns it would add to the federal debt. But on Friday, he said he was
swayed to support the bill despite its cost. The congressional Joint
Committee on Taxation analysis showed the Senate plan would add $1 trillion
to the federal budget deficit.

"This bill is far from perfect, and left to my own accord, we would have
reached bipartisan consensus on legislation that avoided any chance of adding
to the deficit, and far less would have been done on the individual side with
items that do not generate economic growth," he said.

What's in the Final Republican Tax Bill 

The legislation would cut taxes for corporations. American taxpayers, in
large part, would also get cuts, though most of the changes affecting them
would expire after 2025. 

In a tweet on Friday, Mr. Rubio called the Senate's inclusion of the expanded
credit "a solid step," and a spokeswoman said he would now vote for the bill.

For far too long, Washington has ignored and left behind the American working
class.  Increasing the refundability of the Child Tax Credit from 55% to 70%
is a solid step toward broader reforms that are both pro-growth and
pro-worker.

The bill's text, which was signed by Republican negotiators from the
chambers' conference committee on Friday, includes few major changes from the
version that passed the Senate this month. The 2025 expiration date for the
individual tax cuts remains, as does the estate tax, which would apply to
fewer Americans down the road. At the center of the $1.5 trillion bill are
large tax cuts for corporations and other businesses, which Republican
lawmakers say will create jobs, investment and economic growth.

Compared with the Senate bill, the revised legislation would lower some
thresholds for entering a higher individual marginal tax bracket. For
example, the top bracket for a married couple filing jointly would begin at
$600,000 a year, down from $1 million in the Senate bill.

Owners of so-called pass-through businesses, who pay taxes on their profits
at the owner's individual tax rate, would receive a slightly less generous
tax break than the Senate- and House-passed bills called for, allowing a 20
percent deduction on profits they earn. That deduction would phase out - with
some exceptions - starting at $315,000 of income for couples. The Senate bill
included a larger deduction, 23 percent, and a higher phaseout point,
$500,000 for couples.

Two newly revealed changes on the business side would help offset revenue
losses: a provision that limits corporations' deductions of their net
operating losses to 80 percent of their income starting next year, instead of
in 2023 as the Senate bill called for, and one that would effectively reduce
the annual value of research and development tax breaks starting in 2022.
Those changes combined to raise an additional $100 billion.

Republicans released the bill's text late on Friday afternoon and were aiming
to vote on it next week.

The bill appears to be heading toward the finish line, though at least three
other Republican senators remained publicly undecided on Friday, including
Mike Lee of Utah, who has allied with Mr. Rubio in pressing for an expanded
child credit, and Jeff Flake of Arizona, who has been trying to extract
commitments from Republican leadership related to the Deferred Action for
Childhood Arrivals, or DACA, program. Ms. Collins has also expressed
reservations about the bill's reduction in the top individual tax rate and
pushed for party leaders to support measures to bolster individual health
care markets as a condition for her vote.

Ms. Collins is still reviewing the bill, a spokeswoman said. A spokesman for
Mr. Flake said the senator was undecided.

Mr. Lee, in a statement, sounded upbeat about the bill, saying Mr. Rubio and
other senators "have done a tremendous job fighting for working families this
week and they have secured a big win." He added: "I look forward to reading
the full text of the bill and, hopefully, supporting it."

Mr. Trump, when asked about Mr. Lee and Mr. Rubio on Friday, said he had no
concerns about their support.

"I think they'll be great," he said. "They're great people. They want to see
it done. I know them very well. I know how they feel. These are great people
and they want to see it done, and they want to see it done properly."

Mr. Trump also told reporters he had seen the bill, and he liked it.

"I have seen it," Mr. Trump said in brief remarks at the White House. "I
think it's going to do very, very well. I think that we are going to be in a
position to pass something as early as next week, which will be monumental."

Joy Breslauer, President

National Federation of the Blind of Montana 

Web Site: http://www.nfbofmt.org <http://www.nfbofmt.org/> 

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