In a rare show of bipartisanship, the House of Representatives passed a comprehensive tax bill on Wednesday evening.
The bill was passed by a vote of 357 to 70.
The $78 billion package would expand the child tax credit and bring back the popular tax deduction for research and development companies.
It also includes tax credits on low-income housing and tax breaks for Taiwan – offsetting costs by rolling back payroll tax breaks.
The bill will come under suspension of the rules due to some opposition from the Republican Party. Some far-right Republicans oppose the tax credit portion of the bill, while some progressives are expected to oppose the bill, saying it does not expand the child tax credit broadly enough.
Speaker Mike Johnson said the deal “reinvigorates conservative, pro-growth tax reforms” and “ends a wasteful COVID-era program, saving taxpayers tens of billions of dollars.”
Ways and Means Chairman Jason Smith led negotiations on the bill
The deal passed despite some opposition from the Republican Party and now heads to the Senate
Northeastern Republicans initially objected to the deal because it did not include provisions to roll back former President Donald Trump’s $10,000 cap on state and local tax deductions, known as SALT.
But Republicans from blue states received approval from Republican leadership to vote on a separate SALT bill next week to eliminate the so-called “marriage penalty,” a source familiar with the plans told DailyMail.com.
The SALT deduction is currently limited to $10,000 for both individual and joint filers. The legislation would lift that cap to $20,000 for married filers.
The speaker’s office said the timeline of a SALT vote was fluid and details had not yet been worked out. Johnson and Smith “agreed that they would continue to work with members to find a path forward,” press secretary Athina Lawson said in a statement.
The package would gradually increase the child tax credit from $1,600 to $2,000 and give families who owe less in taxes the opportunity to get it as a refund. It would also give families with multiple children the green light to get the credit more quickly, which would be adjusted each year for inflation.
It would also mean that companies would have to fully cover domestic research and development costs and that the deduction for the purchase of machinery and equipment would be increased until 2025.
Senate Republicans are already discussing the deal, which was negotiated by House Ways and Means Chairman Jason Smith, R-Mo., and Senate Finance Committee Chairman Ron Wyden, D-Ore.
Sen. Chuck Grassley, R-Iowa, said he’s concerned the tax bill will make President Biden “look good” in the 2024 election and that he could win and they won’t pass an extension of to push through Trump-era taxes. cuts.
“I think passing a tax bill that makes the president look good by handing out checks before the election means he can get re-elected and then we won’t renew the 2017 tax cuts,” he told reporters .
Republican Sen. Thom Tillis, R-N.C., told reporters he is “not going to make it easy” for the deal to pass the Senate. ‘It’s bad timing. I think it’s a mistake to do it.’
Last week, Sen. John Cornyn, R-Texas, called the payments in the deal “fake.”
Cornyn told DailyMail.com on Wednesday that he wanted a tax bill to go through the Finance Commission, which, as usual, he is part of.
“Right now it’s just an agreement between two guys,” he said, but did not say how he would vote on it.
The deal would also expand the low-income housing tax credit to attract developers to build affordable rental housing.
Top negotiator Ron Wyden, D-Ore., chairman of the Senate Finance Committee, said these provisions would benefit 15 million children from low-income families and help build about 200,000 affordable homes.
The deal was supported by Senator Wyden
The agreement also provides disaster tax credits, which would provide relief to those affected by recent hurricanes, floods, wildfires and even the train derailment in East Palestine, Ohio — a provision that could attract reluctant members from both sides.
It would eliminate double taxation in Taiwan for companies operating in both the US and Taiwan.
To recoup the cost of the provisions, the deal would shorten the period in which new claims can be made for the Covid-era worker tax credit, which negotiators say is ripe for fraud. T
Hat currently offers employers a credit of up to 70 percent on an employee’s first $10,000 of wages each quarter, or up to $28,000 per year.