Thursday afternoon, the House of Representatives in a vote of 227-205 passed what many are calling sweeping tax reform, and also a partisan victory to show that the sagging fortunes of the GOP can be saved with this piece of legislation, and truly govern; especially after the recent victories by the Democrats in elections held earlier this month; and, especially in Virginia.
The bill, known as the Tax Cuts and Jobs Act, as most know by now, slashes the number of individual tax brackets, does away with the state and local tax deduction, puts a cap of up to $10,000 on property tax deduction, and decreases the corporate tax rate from 35 percent to 20 percent.
It also removes the interest deduction that can be taken by borrowers on federal student loans.
“For too long, this broken tax code has eroded America’s economic leadership around the world,” said House Ways and Means Committee Chairman Kevin Brady (R-Texas), the chief architect of the legislation.
It also just made the GOP self-imposed rule of decreasing the federal revenue, or deficit, to $1.4 trillion, which states that legislation cannot increase the federal debt by no more than $1.5 trillion.
13 Republicans broke rank and opposed it, with no Democrats supporting it.
The loss of the state and local tax deduction is a blow to some states such as New York and California; and nearly all of the “no” votes came from these states, and especially from Rep’s, Pete King and John Faso, and from California, Darrell Issa, Tom McClintock, and Dana Rohrbach.
The increase in taxes to most middle class taxpayers, the loss of the so-called SALT (state and local taxes) deduction, the cap on the mortgage deduction, and the loss of the student interest deduction, make it hard to see this as a boon to the middle class, because at its heart this proposal is really about slashing the corporate tax rate, with the subsequent loss of long-standing deductions, to help pay for it.
The Hill reported that “Democrats denounced the bill, saying it mostly benefit wealthy individuals and corporations while increasing taxes on some in the middle class. Rep. John Yarmuth (D-Ky.), the top Democrat on the House Budget Committee, brought a giant check to the House floor debate giving $500 billion to “The Wealthiest 1%” from “The American Taxpayers.” The fake check was signed, “Congressional Republicans.”
The Los Angeles Times noted that “House Minority Leader Nancy Pelosi drew on the teachings of historic and religious figures to warn Republicans off legislation that she said benefits the wealthy and “preys on the middle class.” She also remarked even before the vote that that is “ . . . a shameful piece of legislation.”
Coming next is the Senate version that will begin mark-up the week after the Thanksgiving holiday. But, news from that quarter is bound to be controversial, and after being buffeted, and lampooned in the national press, not to mention by Democratic lawmakers, such as Minority Leader Sen. Chuck Schumer, Republican efforts to pass tax reform took a new tack, late Tuesday night, with an addition to the proposal: the removal of the individual mandate from the Affordable Care Act; something that has always been an option, and that was mentioned just after the inauguration of Donald Trump, as a way for Republican leadership to destroy it.
Of course, all things considered equal the “proposal to the proposal”, is not as popular as it might seem. First of all, it would increase the insurance premiums offered on the health exchanges that are part of the ACA, as well as employer offered plans, which was also going to happen with Graham-Cassidy, and helped to defeat it.
Secondly, it brings back all of the toxic fumes that swirled on Capitol Hill, each and every time there are attempts to gut the legislative legacy of President Obama; but most of all as the Congressional Budget Office noted, 13 million people would be uninsured, as a result, over the next decade; a true hardship for hardworking American families.
The push for it to be included came in a tweet from Majority Leader Mitch McConnell who said, that the money saved - approximately $338 billion - could be used to “puff up some of the middle class tax relief that we would like to puff up,” yet the bill has been shown to increase the national deficit, by at least $1.5 trillion, and that is a conservative estimate, by the Manhattan Institute.
It’s still the reality that much like earlier legislative efforts, the Trump Administration is still focused on wealth transfers to make favorable cuts to the wealthy, and a former adviser to John McCain noted in a recent tweet, “A tax ‘reform’ bill which raises taxes on the middle class, strips millions of families from their health care, rewards the top 1% and balloons the deficit is the political nail in the coffin for the GOP,” sad John Weaver.
Conservative “Blue Dog” Democrats opposed the reform bill on Wednesday for adding to the national debt, unlike the House version, which just made it, under their own rules.
Critics note that could change, especially under pressure, as was done in the House version for the change in the pass through to benefit small business owners, and there is no guaranteed support; especially by senators from high tax states.
It could especially damage the fragile alliance with Sens. Susan Collins, Lisa Murkowski and John McCain, because if they insist on the Alexander-Murray agreement, then the whole ship could sink, as the Senate can afford to lose no more than two votes, to pass the measure.
The Senate, like its House counterpart, also increases the tax bill for some Americans, and not others, mostly the wealthy, and especially those living in Illinois, New York or New Jersey, with the removal of the state and local tax deduction.
It will also not help those who might want to buy a new home, and deduct the interest on payments, since with the proposed the doubling of the standard deduction, (despite differing amounts in the both versions), makes that a less attractive option.
Chicago real estate journalist, Don DeBat, noted in his recent column for a Chicago community newspaper, News-Star, that “existing homeowners can keep their existing mortgage interest deductions, but purchases that are made moving forward will be capped for homes valued at up to $500,000, and limit the deductions to $10,000 for property taxes.”
He notes that this especially affects the local luxury market, quoting experts who say that the “deduction would cut $10,000 to $15,000 in write offs. . .”
So, how does the plan help America’s middle class? Well, it can’t, and it won’t.
On the health front, there has been an appeal, from some, to those to use the more common-sense Alexander-Murray proposal to extend some of the ACA provisions with room for opt-outs from the states, but that is anathema to those who oppose the ACA.
The cut, and the tax increases, angered Murkowski, who said, in exasperation: “tell me how that’s making me a happier person in the middle-class here?”
Perhaps the best remark was from Sen. Murray herself, who said, “Tacking Alexander-Murray onto the partisan Republican tax reform effort is like trying to put out a fire with penicillin.”
In a recent CNN Poll, 6 of 10 voters do not feel that the Trump Administration is doing enough to make healthcare work, the way it should, for Americans.
One long-standing issue is when reconciliation comes, between the House and the Senate versions is the fate of entitlements, the long sought after desire of Speaker Paul Ryan, who has hinted that he is comfortable slashing Medicare by at least 30 percent, if that is what it takes to balance the two bills.
The bill, known as the Tax Cuts and Jobs Act, as most know by now, slashes the number of individual tax brackets, does away with the state and local tax deduction, puts a cap of up to $10,000 on property tax deduction, and decreases the corporate tax rate from 35 percent to 20 percent.
It also removes the interest deduction that can be taken by borrowers on federal student loans.
“For too long, this broken tax code has eroded America’s economic leadership around the world,” said House Ways and Means Committee Chairman Kevin Brady (R-Texas), the chief architect of the legislation.
It also just made the GOP self-imposed rule of decreasing the federal revenue, or deficit, to $1.4 trillion, which states that legislation cannot increase the federal debt by no more than $1.5 trillion.
13 Republicans broke rank and opposed it, with no Democrats supporting it.
The loss of the state and local tax deduction is a blow to some states such as New York and California; and nearly all of the “no” votes came from these states, and especially from Rep’s, Pete King and John Faso, and from California, Darrell Issa, Tom McClintock, and Dana Rohrbach.
The increase in taxes to most middle class taxpayers, the loss of the so-called SALT (state and local taxes) deduction, the cap on the mortgage deduction, and the loss of the student interest deduction, make it hard to see this as a boon to the middle class, because at its heart this proposal is really about slashing the corporate tax rate, with the subsequent loss of long-standing deductions, to help pay for it.
The Hill reported that “Democrats denounced the bill, saying it mostly benefit wealthy individuals and corporations while increasing taxes on some in the middle class. Rep. John Yarmuth (D-Ky.), the top Democrat on the House Budget Committee, brought a giant check to the House floor debate giving $500 billion to “The Wealthiest 1%” from “The American Taxpayers.” The fake check was signed, “Congressional Republicans.”
The Los Angeles Times noted that “House Minority Leader Nancy Pelosi drew on the teachings of historic and religious figures to warn Republicans off legislation that she said benefits the wealthy and “preys on the middle class.” She also remarked even before the vote that that is “ . . . a shameful piece of legislation.”
Coming next is the Senate version that will begin mark-up the week after the Thanksgiving holiday. But, news from that quarter is bound to be controversial, and after being buffeted, and lampooned in the national press, not to mention by Democratic lawmakers, such as Minority Leader Sen. Chuck Schumer, Republican efforts to pass tax reform took a new tack, late Tuesday night, with an addition to the proposal: the removal of the individual mandate from the Affordable Care Act; something that has always been an option, and that was mentioned just after the inauguration of Donald Trump, as a way for Republican leadership to destroy it.
Of course, all things considered equal the “proposal to the proposal”, is not as popular as it might seem. First of all, it would increase the insurance premiums offered on the health exchanges that are part of the ACA, as well as employer offered plans, which was also going to happen with Graham-Cassidy, and helped to defeat it.
Secondly, it brings back all of the toxic fumes that swirled on Capitol Hill, each and every time there are attempts to gut the legislative legacy of President Obama; but most of all as the Congressional Budget Office noted, 13 million people would be uninsured, as a result, over the next decade; a true hardship for hardworking American families.
The push for it to be included came in a tweet from Majority Leader Mitch McConnell who said, that the money saved - approximately $338 billion - could be used to “puff up some of the middle class tax relief that we would like to puff up,” yet the bill has been shown to increase the national deficit, by at least $1.5 trillion, and that is a conservative estimate, by the Manhattan Institute.
It’s still the reality that much like earlier legislative efforts, the Trump Administration is still focused on wealth transfers to make favorable cuts to the wealthy, and a former adviser to John McCain noted in a recent tweet, “A tax ‘reform’ bill which raises taxes on the middle class, strips millions of families from their health care, rewards the top 1% and balloons the deficit is the political nail in the coffin for the GOP,” sad John Weaver.
Conservative “Blue Dog” Democrats opposed the reform bill on Wednesday for adding to the national debt, unlike the House version, which just made it, under their own rules.
Critics note that could change, especially under pressure, as was done in the House version for the change in the pass through to benefit small business owners, and there is no guaranteed support; especially by senators from high tax states.
It could especially damage the fragile alliance with Sens. Susan Collins, Lisa Murkowski and John McCain, because if they insist on the Alexander-Murray agreement, then the whole ship could sink, as the Senate can afford to lose no more than two votes, to pass the measure.
The Senate, like its House counterpart, also increases the tax bill for some Americans, and not others, mostly the wealthy, and especially those living in Illinois, New York or New Jersey, with the removal of the state and local tax deduction.
It will also not help those who might want to buy a new home, and deduct the interest on payments, since with the proposed the doubling of the standard deduction, (despite differing amounts in the both versions), makes that a less attractive option.
Chicago real estate journalist, Don DeBat, noted in his recent column for a Chicago community newspaper, News-Star, that “existing homeowners can keep their existing mortgage interest deductions, but purchases that are made moving forward will be capped for homes valued at up to $500,000, and limit the deductions to $10,000 for property taxes.”
He notes that this especially affects the local luxury market, quoting experts who say that the “deduction would cut $10,000 to $15,000 in write offs. . .”
So, how does the plan help America’s middle class? Well, it can’t, and it won’t.
On the health front, there has been an appeal, from some, to those to use the more common-sense Alexander-Murray proposal to extend some of the ACA provisions with room for opt-outs from the states, but that is anathema to those who oppose the ACA.
The cut, and the tax increases, angered Murkowski, who said, in exasperation: “tell me how that’s making me a happier person in the middle-class here?”
Perhaps the best remark was from Sen. Murray herself, who said, “Tacking Alexander-Murray onto the partisan Republican tax reform effort is like trying to put out a fire with penicillin.”
In a recent CNN Poll, 6 of 10 voters do not feel that the Trump Administration is doing enough to make healthcare work, the way it should, for Americans.
One long-standing issue is when reconciliation comes, between the House and the Senate versions is the fate of entitlements, the long sought after desire of Speaker Paul Ryan, who has hinted that he is comfortable slashing Medicare by at least 30 percent, if that is what it takes to balance the two bills.
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