The House of Representatives and Senate Finance Committee passed an enormous rewrite of the tax codes on Thursday, marking a significant victory for President Trump and a significant step toward the Republican Party’s goal to deliver $1.5 trillion in tax cuts over the next decade. An overhaul of the tax codes would notch President Trump’s first major legislative achievement in his tenure, reported the New York Times.
“Passing this bill is the single biggest thing we can do to grow the economy, to restore opportunity and help these middle-income families who are struggling,” Paul Ryan, Speaker of the House, said ahead of the vote.
The bill was passed in a close but decisive 227-205 House vote, with 13 Republicans voting against the bill and no Democrats voting in favor of it. The Republicans who voted against the bill were from California, New Jersey, New York and North Carolina.
According to the Washington Post, President Trump arrived early at Capitol Hill to address Republican lawmakers behind closed doors, urging them one last time to vote in favor of the bill. The Post also reported that his final words, according to a person in the room, were, “I love you. Now go vote.”
The Senate Finance Committee voted later Thursday to pass the House bill 14-12 along party lines. The full Senate will now consider the bill alongside their own proposed tax legislation after Thanksgiving, according to a New York Times report.
Republicans are anxious to get the legislation to President Trump’s desk before Christmas after failing to repeal the Affordable Care Act, despite holding the majority in both the House and Senate. The backlash against Republicans in the gubernatorial elections also adds to the lawmakers’ pressures, according to the Hill.
The bill, which was passed in the House Ways and Means Committee last week, will cut taxes by more than $1.4 trillion over 10 years, reported the New York Times. The bill cuts the corporate tax rate from 35 percent to 20 percent, collapses the number of tax brackets from seven to four, switches the U.S. to an international tax system comparable with the rest of the world, and scales back many popular deductions, including one for state and local taxes.
The full Senate bill takes a different approach to the taxation of multinational corporations and phases in a lower 20 percent corporate tax rate, while phasing out almost all individual tax cuts after 2025, outlined the Washington Post.
One main discrepancy in the full Senate bill is its complete disregard for the deduction of state and local taxes, known as “SALT”. House Ways and Means Committee Chairman Kevin Brady said the final compromise bill will include the “SALT” provision, according to the Washington Post.
“When you’re reaching for the cranberry sauce, Republicans are going be reaching for your pocketbooks to give handouts to multinational corporations,” Senator Ron Wyden of Oregon, the ranking Democrat on the Finance Committee, said.