Congressional Republicans are signaling they are ready to pass major tax overhaul legislation in the first days of 2018.
The proposed bill, which would reduce the corporate tax rate from 35 percent to 20 percent, was rolled out on Thursday by House Ways and Means Committee chairman Kevin Brady of Texas. Mr. Brady said the overhaul could add as much as $1.5 trillion to the federal deficit over 10 years.
Even so, Mr. Brady and Republicans on the panel said their business-friendly plan would stimulate economic growth that would help boost the incomes of ordinary Americans. “We are about rewarding success, not helping average Americans stand still,” he said.
“I know it’s got to be unpopular to do this today,” he added, “but, these bills don’t face the same backlash as the previous work of Republicans.”
Democrats promptly mocked the bill. “This bill represents more of the same trickle-down economics that failed America for decades,” said Rep. Richard Neal of Massachusetts, the top Democrat on the Ways and Means panel.
“President Trump’s proposed tax plan hasn’t paid for itself. It’s full of gimmicks, wonks and giveaways to the rich,” he added.
Rep. Joseph Crowley of New York, the No. 4 Democrat in the House, said, “We can’t afford to lose these tax breaks to big corporations,” as the tax bill promises. “Are we really going to give those out to big corporations, and then turn around and cut programs that allow lower and middle-income Americans to get ahead?”
The plan would reduce taxes on some individuals and end some tax deductions, while also doubling the standard deduction, a change that would benefit many taxpayers by eliminating its hassle. But a key provision would benefit only corporations by creating a 20 percent deduction for the amount of money they spend on new investment, including stock buybacks. The change benefits big corporations, but it could lower earnings for many smaller companies that count on buybacks to boost their share prices.
Republicans also don’t need Senate Democratic votes to pass the bill.