In a move that has sparked both support and opposition, the House voted on Wednesday night to pass a $78 billion tax package. The bill, which includes an expansion of the child tax credit, will now make its way to the Senate. However, the future of the legislation remains uncertain.
The bipartisan measure received overwhelming support in the Republican-led House, passing with a vote of 357-70. This fast-track process requires a two-thirds majority, highlighting the broad bipartisan agreement on the bill. Despite this support, the legislation faces objections from various corners, exacerbating the uncertainty surrounding its fate.
While the bill has gained significant support, it has not been without criticism. Liberal Democrats oppose the business tax breaks included in the package. Similarly, right-wing Republicans take issue with the child tax credit policy. Additionally, GOP members from New York complain that the bill does not expand the $10,000 cap on federal deductions for state and local taxes.
The legislation now moves to the Democratic-led Senate, where it requires 60 votes to pass. However, it is unclear whether the votes needed for approval are there. One prominent skeptic is Chuck Grassley, a Republican senator from Iowa. As a member of the Finance Committee, Grassley has expressed concerns about the bill, suggesting that its passage may benefit President Joe Biden during an election year.
Senate Majority Leader Chuck Schumer, a Democrat from New York, has yet to provide a clear timeline for the bill or whether any amendments will be made. Speaking to reporters, Schumer expressed his support for the tax package and confirmed that he is working with Senator Ron Wyden, the chairman of the Finance Committee, to determine the best path forward.
The central aim of the legislation is to expand refundable child tax credits, offering relief to struggling families, particularly those with multiple children. The bill proposes an incremental increase in the refundable cap on the credit, currently set at $1,600, while also adjusting it for inflation. Furthermore, the package seeks to resurrect certain expired components of the 2017 Republican tax cuts for businesses, including research and experimental expensing and small-business expensing.
House Ways and Means Committee Chairman Jason Smith, a Republican representative from Missouri, has voiced his support for the tax package. He believes that the bill is “pro-growth, pro-jobs, pro-American.” Smith emphasizes that this legislation will offer parents in communities across the country lower taxes, increased opportunity, and greater financial security.
Republican Response and Proposed Amendments
Republican Senate Minority Leader Mitch McConnell has delegated the Senate GOP response to Senator Mike Crapo from Idaho, the ranking member on the Finance Committee. Crapo advocates for the bill to go through the committee to allow for revisions. He also emphasizes the importance of a floor process where all members can file their amendments.
One specific amendment proposed by Crapo is eliminating the provision that enables taxpayers to use income from a previous year to maximize their child tax credits. He believes that this provision undermines the work requirement associated with the tax credit. While Crapo highlights this concern, he remains tight-lipped about potential changes to other aspects of the tax package.
The Lengthy Path Ahead
As the $78 billion tax package heads to the Senate, its fate remains uncertain. The contrasting opinions and objections from various senators, coupled with the need for a 60-vote threshold, make its passage far from guaranteed. Only time will tell if the bill can overcome these hurdles and become law, potentially impacting the lives of struggling families across the nation.
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