The Republican tax bill that seeks to shift tax benefits to wealthy Americans could finally be passed. However, there are still a number of unresolved issues. On Monday, Republican lawmakers were back in Washington to pass the bill. However, there were feverish talks among senators to try and resolve key contentious issues that could jeopardize its passage.
Republicans are desperate for a legislative victory after the much-publicized failure to pass the Trumpcare bill. Pressure is mounting on the GOP to pass the tax bill, but lawmakers are still contemplating a number of key changes. To start with, amendments that could reward high-income business owners with tax benefits have already been proposed. High-income business owners will benefit a lot if the proposed tax bill is passed.
However, it seems that this is not enough. Conservative lawmakers and trade groups are pushing for more changes to maximize the benefits or sweeten the deal. The momentum for amendments that would benefit low-income Americans is however very slow. According to the Congressional Budget Office, the Senate bill as currently written will hurt American workers who are making less than $30,000 a year in short order, while delivering more benefits to higher income earners.
One of the key areas of contention is whether amendments should be made to favor small businesses and “pass-through entities.” These are basically businesses whose profits are distributed to their owners. However, research indicates that 70% of the total pass-through income goes to the top 1%.
Two Republican senators have already said they will vote against the bill if amendments that favor pass-through entities are not included. Although Republicans control the house 52 to 48, they cannot afford to lose more than two lawmakers. There is still room for debate and a possibility of compromise in some of the raised issues. But it is increasingly becoming clear that it may eventually boil down to Party lines.
It’s going to be a frenzied week as lobbyists and lawmakers work to push their interests. Behind-the-scenes negotiations, arm twisting, and deal making are expected to be the order of the day at least until Friday when the bill is expected to go for a Senate floor vote.
The majority of Republican senators who have expressed reservations on the bill as currently written are already engaging with Party leaders in an effort to break any potential impasse. On Monday, president Trump met with several Republican senators for lunch. There was confidence after the meeting that the administration will have enough votes to pass the legislation this week.
But resolving the differences that have emerged between the Senate and the House could be the biggest issue. Trump is expected to go to the Capitol for a meeting with top congressional leaders. The President will meet leaders from both parties. The passing of the Republican tax bill could be a major legislative victory for the president. But he is not there yet. As lobbyists and senators pull and push, it will take a significant degree of negotiations to get to common ground.