U.S. House Speaker Paul Ryan addresses a Nov. 16, 2017 news conference after the House passed a tax cut plan on Capitol Hill in Washington D.C. (Ting Shen/Xinhua/Zuma Press/TNS)

U.S. House Speaker Paul Ryan addresses a Nov. 16, 2017 news conference after the House passed a tax cut plan on Capitol Hill in Washington D.C. (Ting Shen/Xinhua/Zuma Press/TNS)

House passes GOP tax plan as Congress prepares to deliver Trump’s top legislative priority

WASHINGTON — The House has passed the sweeping GOP tax plan on a near-party-line vote, with the Senate expected to quickly follow, as congressional Republicans move to give President Donald Trump his most significant legislative victory of the year — one that has come at a steep political cost.

Polling shows the $1.5 trillion package remains broadly unpopular, contributing to a political environment in which even surveys by Republican groups show the party in serious danger of losing control of Congress in next year’s midterm elections.

Republican leaders insist the measure, which is centered on a huge cut in corporate taxes, will spur economic growth and become more popular once it takes effect.
“No concerns whatsoever,” said House Speaker Paul Ryan, R-Wis., who has spent a career trying to lower taxes and shrink government.

“When you have a sling-fest, a mud-fest on TV,” Ryan told reporters Tuesday, “that’s what going to happen. But when we get this done and people see the withholding improvement, when they see the jobs occurring, when they see bigger paychecks … that’s what going to produce the results.”

In saying that, however, Ryan sounded much like his predecessor as speaker, Rep. Nancy Pelosi, D-Calif., who insisted in 2010 that the Affordable Care Act would become more popular once Americans experienced it. It didn’t _ at least not then _ and instead contributed heavily to the Democrats’ losing their House majority that year.

Although the two measures are very different, they have in common that both were passed almost entirely on the votes of one party, a strategy that almost guarantees widespread public opposition.

Pelosi on Tuesday called the tax bill an “all-out looting of America.”

“This is the worst bill to ever come to the floor of the House,” Pelosi said. “The American people see this tax scam for exactly what it is.”

So far, polls suggest Americans reject the tax plan by a wide margin, roughly 2 to 1, according to a new Monmouth University poll. CNN said Tuesday that its latest poll showed that nearly 1 in 4 Americans expect their families will be worse off.

Senate Majority Leader Mitch McConnell, R-Ky., who plans to bring the tax bill to a vote in his chamber later Tuesday, conceded that Republicans haven’t yet convinced Americans about the merits of the bill.

“We’re just beginning to make the argument to the American people,” McConnell told reporters, despite the months of debate over the tax measure. “The argument is still out there to be won.”

The legislation “will provide much-needed relief to middle-class families and small businesses, and will set America on a trajectory towards more opportunity and greater prosperity,” he said earlier in the day.

Outside analysts, though, have warned that benefits of the tax overhaul will largely flow to corporations and the wealthy, with lower- and middle-income households seeing only modest improvements.

Moreover, the cut in corporate tax rates will be permanent while the breaks for individuals and families are scheduled to expire in 2025.

The nonpartisan Tax Policy Center estimates that households will see their taxes reduced by $1,600, on average, in 2018. That’s on par with Republican claims.
But those savings are uneven across income levels.

Taxpayers earning less than $25,000 will save about $60 a year, while the top 1 percent, earning more than about $733,000 annually, would see a roughly $50,000 cut, or 3.4 percent of their after-tax income. Middle-income taxpayers, earning between $49,000 and $86,000, would see an average tax cut of about $900.

Among middle- and upper-middle-income households, results will vary widely. Many taxpayers in states with high taxes, especially California, New York and New Jersey, are likely to see tax hikes because the bill limits the current deductions for state and local income taxes.

“The basic story of the bill has remained the same since it was first introduced in early November,” Tax Policy Center analyst Howard Gleckman wrote. “Most households would get a tax cut at first, with the biggest benefits going to those with the highest incomes.”

Central to the legislation is a reduction in the corporate tax rate from 35 percent to 21 percent. Republicans say the resulting economic growth will more than cover the cost to the Treasury. Most independent economists, however, warn that growth will not be so robust and that the $1.5 trillion package will add to the federal deficit.

For individuals, the tax bill is mixed. Once envisioned as a simplification that would allow Americans to file tax returns on a postcard, it has not fully met that goal. Rates will be lowered, including the new top rate of 37 percent, which will hit households earning $600,000 or more.

A bigger standard deduction, at $12,000 for single filers or $24,000 for couples, is intended to replace many popular write-offs.

The state and local tax deduction will be capped at $10,000, covering both income and property taxes. Mortgage interest deductions will be limited to loans of $750,000, rather than $1 million in current law, a change that is expected to ripple through housing markets in high-cost areas.

Other deductions that had been targeted for elimination were salvaged in last-minute negotiations between the House and Senate Republicans, including those for medical expenses, student loan interest and graduate student tuition waivers.

A child tax credit championed by Sens. Marco Rubio, R-Fla., and Mike Lee, R-Utah, with backing from Ivanka Trump, will be doubled to $2,000. Part of that, $1,400, will be fully refundable for those who don’t otherwise owe beyond their payroll taxes.

The legislation will repeal the Affordable Care Act’s mandate that all Americans carry health insurance by doing away with a tax on those who fail to have coverage.
Republicans shrug off the poor standing the bill has in polls as no different than the last major rewrite of the tax code, under President Ronald Reagan in 1986. But the current proposal is significantly less popular than that one.

As Monmouth warned in their analysis of the polling data, the bill gets especially poor ratings in suburban areas where the Republicans already have struggled this year.

“The package doesn’t play well in areas of the country that the GOP needs to win in 2018,” Monmouth said.

Republicans in Congress, though, have pushed past those worries. They’ve been anxious to deliver a legislative win for Trump’s first year in office, especially after the collapse of their efforts to repeal Obamacare, and make good on their campaign promises before facing voters.

The tax cuts will take effect in the new year, meaning workers can adjust their withholding to see the change in their paychecks.

Despite the GOP’s majorities in both houses of Congress, passing the tax cut has not been easy.

To win over holdouts, Republican leaders included various provisions, including one to open the Arctic National Wildlife Refuge to oil and gas drilling, which was important to Sen. Lisa Murkowski, R-Alaska.

Republican Sen. Susan Collins, a centrist from Maine, announced her support after winning various concessions, including upcoming votes to help stabilize Obamacare.
The lone Senate Republican who opposed the bill earlier, Bob Corker of Tennessee, now supports the bill, brushing back criticism that he will personally benefit from it.US

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