Hoping to Broaden Support, House Republicans Will Revise Tax Bill This Week

Hoping to Broaden Support, House Republicans Will Revise Tax Bill This Week

REUTERS/Zach Gibson

Facing pockets of discontent in their own Republican ranks, tax negotiators in the U.S. House of Representatives will seek this week to brook differences over their far-reaching tax bill and stick to a self-imposed deadline of passage this month.

The House tax-writing committee begins revising the bill on Monday with tweaks and some more substantial changes expected to a number of individual and corporate tax proposals.

House Republicans last week unveiled the first draft of a 429-page tax bill that, if enacted, would be the biggest overhaul of the U.S. tax system since the 1980s.

It proposes a range of tax cuts aimed at helping businesses, including slashing the corporate rate to 20 percent from 35 percent and establishing a new 25 percent tax rate for “pass through” businesses, which are currently taxed at rates as high as 39.6 percent.

House Speaker Paul Ryan told Fox New Sunday that there are a “host of ideas” being considered as lawmakers begin revising the bill, though he expected the broad outlines to remain the same.

One controversial component for lawmakers from high-tax states repeals a popular federal tax deduction for state and local income tax (SALT) payments, while preserving a deduction for property tax payments, capped at $10,000 per year.

House Ways and Means Chairman Kevin Brady worked out a compromise last week that preserved the deduction for property taxes after pushback from Republicans representing states such as New Jersey, New York and California, which would be disproportionately hit by the repeal.

States that would be hit hard by the elimination of a SALT deduction have enough Republican members in Congress to derail the tax legislation. Many have already said they would like to see the cap raised on the property-tax deduction or the income-tax deduction retained.

The Senate is developing its own version of the legislation and it would have to eventually be reconciled with the House version before it is sent to President Donald Trump.

On Sunday Morning Futures with Maria Bartiromo, Vice President Mike Pence called the House bill a “great start.”

“We look forward to the Senate bringing forward the tax cut, the key here is that whatever is accomplished reflects the President’s commitment to cutting taxes on working families,” said Pence, who would be the tie-breaker if needed in a Senate vote.

If Republicans pass tax legislation, it will be the first major legislative achievement since Republicans took control of the White House and Congress in January - and a rebound from their failure to overturn the Affordable Care Act, or Obamacare.

Ryan said on Sunday that he still believes the House is on track to vote on a revised tax bill before the U.S. Thanksgiving holiday on Nov. 23.

Reporting by Amanda Becker; Editing by Mary Milliken.