Republicans are reportedly expected on Friday to unveil a final consensus bill to overhaul the U.S. tax system, with the goal of bringing it to a vote next week.
Both the House and Senate have passed versions of a tax-reform bill. In a conference committee Thursday, the two chambers appeared to reach an agreement on merging the two plans — despite reports that some Republicans were still threatening defection if certain elements were not included.
Sen. Marco Rubio (R-Fla.), for example, indicated in The New York Times that he would hold out for an expanded version of the child tax credit.
Other ideas still being discussed Thursday to help pay for the bill included allowing tax cuts for individuals to expire sooner than 2025, or raising the tax rate on profits that companies have parked overseas.
Republicans in the House and Senate agreed in principle on a 21 percent corporate tax rate, down from the current 35 percent; and a lower top individual tax rate of 37 percent for the wealthiest taxpayers, down from 39.6 percent, according to The New York Times.
Other elements reportedly in the consensus bill include:
-A repeal of the Affordable Care Act health insurance mandate.
-Repealing the corporate alternative minimum tax.
-The rate for pass-through income would be determined by a 20-percent deduction. That would apply to business entities like s-corporations and partnerships that pay taxes through the individual side.
-State and local tax deductions would be expanded to include income tax, but the deduction would be capped at $10,000.
-The mortgage interest deductibility threshold would be set at $750,000.
-High out-of-pocket medical expenses will be deductible.
-Graduate students who receive tuition waivers would not have to pay taxes on that benefit, as proposed by the House bill.
Reports indicated Republican lawmakers were confident they could pass the sweeping legislation next week, though two GOP senators, John McCain of Arizona and Thad Cochran of Mississippi, are sidelined for medical reasons. And Sen. Bob Corker of Tennessee has expressed opposition.
No Democrats are expected to vote for the bill, and party leaders called the consensus bill a “sham,” saying the tax cuts were deeply unpopular among taxpayers. Some called for a delay to allow incoming Democratic Senator Doug Jones in Alabama to be seated in January.
If a vote is held Monday or Tuesday as planned, the bill could reach President Trump’s desk by the end of the week, and would go into effect in 2018.
Contact Lisa Jennings at [email protected]
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