House passes $1.5T tax bill in major win for GOP
- Author: Darren Santiago Dec 20, 2017,
Dec 20, 2017, 0:41
The Republicans' final drive to deliver the tax package to an eager President Donald Trump begins Tuesday with a vote in the House.
The U.S. House of Representatives approved the final version of a GOP-backed tax plan Tuesday that would overhaul the nation's tax laws for the first time in decades. "The changes in the SALT deduction actually don't satisfy the needs of the people that I represent".
So-called pass-through businesses - companies organized as S-corporations, Limited liability corporations (LLC), sole proprietorships and partnerships, will be taxed at the individual rate of 20 percent rather than at the corporate tax rate.
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. The bill represents the first major legislative achievement for the GOP after almost a full year in control of Congress and the White House.
A Senate vote later in the day on Tuesday is expected to seal the deal. "That's all I'm hearing from Republicans".
The bill would drop today's 39.6 percent top rate on individuals to 37 percent.
The biggest beneficiaries of the new tax plan are corporations, whose tax rate will decrease from 35 percent to 21 percent.
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Their long-sought political goal within grasp, Republicans in Congress are set to catapult sweeping $1.5 trillion tax legislation through the House, rolling over a dozen GOP defectors from high-tax states. But the new rules preserve many popular deductions, such as for mortgage interest, student loans, adoptions and charitable giving.
The bill passed along partisan lines at 227 for and 203 against.
Middle-income households would see an average tax cut of $900 next year, while the wealthiest one per cent of Americans would see an average cut of $51,000, according to the nonpartisan Tax Policy Centre, a think-tank in Washington.
Republicans claim that the bill will lead to stronger economic growth, while Democrats argue the legislation will give tax cuts to the wealthy at the expense of the middle class.
Rep. Kevin Brady, the chairman of the Ways and Means Committee, says that analyses focusing on the back end of the 10-year window are misleading because numerous individual tax breaks expire in eight years. "Look, we've just finished eight years of Washington spending your money".
"There are so many rip-offs in this bill that people are going to say this is some kind of new Gilded Age", said Sen.