House approves Republican tax overhaul; Senate vote next
January 22 2018, 01:57 | Irvin Gilbert
AP Paul Ryan was all smiles as he walked to the House floor Tuesday
The $1,000 per child tax deduction would grow to $2,000, with up to $1,400 available in IRS refunds for families who owe little or no taxes. More holdout GOP senators- moderate Susan Collins of ME and Mike Lee of Utah - came into the fold on Monday. Republicans cheered as House Speaker Paul Ryan announced the vote.
Despite many state residents' concerns over losing the full deductibility of local and state taxes and lower mortgage tax deduction limits, 12 Republican representatives from California voted in favor of passing the bill.
Republicans have touted their bill as a middle-class tax cut and promised it would produce enough economic growth to boost hiring and workers' wages, as well as create enough revenue to keep it from making any additions to the deficit.
The legislation also reduces tax rate for most individuals, although the tax cuts for individuals are set to expire. The bill represents the first major legislative achievement for the GOP after almost a full year in control of Congress and the White House. The debt is expected to soar by at least $1 trillion more than it would without the tax measure, according to projections.
Democrats say the bill will deepen the income gap between rich and poor Americans, while adding $1.5 trillion over the next 10 years to the mounting $20 trillion USA national debt.
Colin Parent, a councilman for the city of La Mesa, said the GOP tax plan would make it "harder for all ends of the housing ladder". In the years immediately following passage of this bill, Americans earning between $20,000 and $30,000 will experience a 13.5 percent tax cut compared with an eight percent tax cut for the average American. "That's just cherry-picking the numbers", Rep. Kevin Brady, R-Texas, head of the tax-writing House Ways and Means Committee, told reporters Monday.
Twelve of them voted against the House tax bill last month, which passed 227-205.
Passing the bill in December, with many provision set to take effect January 1, 2018, leaves employers and employees little time to figure out how to adjust take-home pay under the new bill and it remains unclear how long it will take the Internal Revenue Service and payroll professionals to figure out how to adjust withholdings under the new law.
The tax bill also removes both student loan interest deduction and employer-provided educational assistance-two hits that disproportionately affect women, who statistically carry more educational debt.
The deduction is especially vital to residents of high-tax states.
"The combination of their attempts to repeal Obamacare followed soon after by this tax bill is basically a one-two punch to their chances in 2018", said Guy Cecil, chairman of Priorities USA, a Democratic super PAC, which has been running ads against Republicans supporting the tax bill.
Even with the compromises, though, the bill did have some dissenters among House Republicans.
Republicans, who control the 100-seat Senate by only a 52-48 margin, can afford to lose support from no more than two party lawmakers.
Vice President Mike Pence, who is president of the Senate, would be called on to cast the deciding vote in case of a deadlock. John McCain, R-Ariz., is at home battling brain cancer and is expected to miss the vote.