Senate GOP Unveils Their Tax Reform Bill, With Noticeable Differences from House's Version

Politics News Tax Reform
Share Tweet Submit Pin
Senate GOP Unveils Their Tax Reform Bill, With Noticeable Differences from House's Version

As Republican politicians race to achieve their goal of passing something, anything in line with the promises they made last year, GOP senators have revealed their proposal for tax reform—and it’s pretty different from the House’s bill.

The NYT reports that the two bills show how pressures on Senate and House Republicans differ: House GOP members in high-tax states feel vulnerable in the upcoming midterms, while Republican Senators are more sensitive to the federal deficit. Both branches acknowledge that their bills will require changes before being finalized.

House GOP members from high-tax states like California or New York likely had a hand in keeping tax breaks for state and local incomes—these breaks are heavily used in those largely Democrat states. The Senate version, however, does away with the tax break entirely, unconcerned as they are with upsetting constituents in Democrat states. House Republicans criticized this: Rep. Leonard Lance (R-NJ) said, “Every state should be a winner in tax reform, and in my opinion, that would not be the case if the Senate view were to prevail.”

The Senate’s plan would also delay the proposed corporate tax cuts that everyone knows are the driving force of the bill. The only reason this is such a hot-button issue for Republicans is their corporate backers demand a return on their investment; the main reason they backed the GOP was this tax cut. A conservative advocacy group has already called the delay of the tax cut “unacceptable.”

There are other, smaller differences between the bills: The Senate version keeps the bottom tax bracket at 10 percent, while the House’s would raise it to 12 percent. The Senate would lower the highest tax bracket to 38.5 percent; the House’s maintained it at 39.6 percent. After Senator Marco Rubio commented on how the child tax credit was too low in the House’s version, the Senate’s version raised it … from $1,600 to $1,650.

The House and the Senate now begin a scramble to revise their documents and compromise on one they can agree on before the end of the year. Conservatives are lining up on either side: Senators have disparaged the House’s version and House Representatives have expressed dissatisfaction with the Senate’s. Senator Jeff Flake, who recently made headlines for running away from his re-election bid with his tail between his legs, said he was worried about how both of them affected the federal deficit.

While the differences reflect the separate priorities of the two legislative groups, the similarities are perhaps more important: Both versions would add to the federal deficit. Both versions plan to offset that by raising taxes on multinational corporations with overseas profits. Both versions are pretty much obviously helping wealthy corporations and landowners before anyone else.