Under an agreement between the House of Representatives and the Senate, the corporate tax would be 1 percentage point higher than the 20 percent rate earlier proposed, but still far below the current headline rate of 35 percent, a deep tax reduction that corporations have sought for years.
As they finalized the biggest tax overhaul in 30 years, Republicans wavered for weeks on whether to slash the top income tax rate for the wealthy. In the end, they agreed to cut it to 37 percent from the current 39.6 percent.
The emerging agreement would repeal the corporate alternative minimum tax, set up to ensure profitable companies pay some federal tax, and expand a proposed$10,000 cap for state and local property tax deductions to include income tax, lawmakers and sources familiar with the negotiations said.
The deal would gut part of the Obamacare health law by repealing a federal fine on individuals who fail to obtain health insurance, while authorizing oil drilling in Alaska’s Arctic National Wildlife Refuge. Both add-on measures were part of nailing down sufficient votes for passage.
Moving the corporate tax target rate to 21 percent from 20 percent gave tax writers enough revenue to make the tax cuts immediate, Republican Senator Ron Johnson told reporters.
A final bill could be formally unveiled on Friday, with decisive votes expected next week in both chambers.
UNDECIDEDS
Despite expressions of confidence about passage from party leaders, the path to a final vote in the Senate could still be perilous. Republicans, who hold a 52-48majority in the 100-seat Senate, can lose no more than two votes on the tax bill.
At least three other Senate Republicans still seemed to be undecided, including Arizona’s Jeff Flake, who was not specific about his hesitation in brief hallway remarks to reporters.
In a White House speech, Trump said the Internal Revenue Service had advised that if he signs the bill into law before Christmas, the tax cuts would take effect in February.
DEBT EXPANDS
As drafted, the Republican plan was expected to add as much as $1.5 trillion to the $20 trillion national debt in 10 years. With that in view, Republicans have been urgently trying to finalize details of their package without increasing its estimated impact on the federal deficit and the debt.
Thai
Eng