House panel releases Tax Reform 2.0 for Thursday vote
WASHINGTON – House Republicans released the text of three bills making up their Tax Reform 2.0 legislation Monday, which would make permanent the cap on the deduction for state and local taxes as well as the higher threshold for individuals subject to the alternative minimum tax.
The legislation would also make permanent the lower income tax rates for individuals that were in the Tax Cuts and Jobs Act enacted last December. Under that act, all three of these provisions were temporary and would expire at the end of 2025.
The bills will be used for messaging by House Republicans in the run-up to the November election but have a slim, if any, chance of passage in the Senate because they would need a 60-vote supermajority for passage. Republicans only hold 51 seats in the Senate.
"It may make it out of the House, but it's not going to go anywhere in the Senate," said one seasoned tax observer who did not want to be identified. "There's no way they'll get 60 votes in the Senate."
The House Ways and Means Committee is expected to vote on the proposed legislation Thursday.
Committee Chairman Kevin Brady, R-Texas, said in a release Monday, “The Tax Cuts and Jobs Act changed the trajectory of our economy for the better. Now it’s time to change the culture in Washington where we only do tax reform once a generation. This legislation is our commitment to the American worker to ensure our tax code remains the most competitive in the world.”
Some House Republicans, however, are opposed to bringing the bills to the floor.
Twelve House Republicans from wealthy states such as New York and New Jersey voted against final passage of the tax reform bill last year because of the impact of the new $10,000 cap on the deduction for state and local taxes. They aren't happy about a bill making the cap permanent.
The legislation also would raise the threshold for the AMT to $109,400 for couple and $70,300 for singles with a phase-out of $1 million for couples and $500,000 for singles.
These provisions are in the proposed bill entitled the Protecting Family and Small Business Tax Cuts Act of 2018 (H.R. 6760).
That bill will be considered by the committee along with two others that would provide incentives for family savings and business innovation.
If the committee approves the three bills, House Republicans plan to bring them to the floor for passage before the November election with that vote coming perhaps before the end of this month.
Meanwhile the ranking Democrat on the House Ways and Means Committee, Rep. Richard Neal of Massachusetts, lasted the proposed legislation, saying the Republicans “have doubled down on their initial tax scam and are yet again putting the wealthiest, most privileged Americans ahead of average, hardworking families.”
Lynn Hume contributed to this article.