The House of Representatives on Wednesday gave broad bipartisan approval to a $78 billion bill that expands the child tax credit and restores a series of corporate tax breaks, the first Congress to do so. This is an unusual feat in an election year.
The bill passed 357-70, with mainstream lawmakers from both parties pushing for passage of the first major bipartisan bill of the year in the House. Forty-seven Republicans and 23 Democrats voted against the bill.
But despite lopsided expressions of support, the bill faces an uphill road to passage amid political divisions over who would benefit most. The effort, which faces resistance from Senate Republicans, raises questions about whether a painfully narrowly divided Congress can counter the dysfunction in the Republican-led House and put electoral politics aside to pass legislation that includes wins for both parties. It has become a test for us.
Rep. Jason Smith, R-Missouri and chairman of the House Ways and Means Committee, supported the bill as “pro-growth, pro-jobs, and pro-America.”
“This is a strong, common-sense bipartisan step forward to provide emergency tax relief to working families and small businesses,” Smith added.
The package would expand the child tax credit and reinstate a series of business tax breaks related to research and development and capital spending, albeit significantly reduced from pandemic-era levels. Both measures, scheduled to last until 2025, will also strengthen low-income housing tax credits and expand tax incentives for disaster victims and Taiwanese businesses and individuals.
The plan, a pandemic-era measure, would be funded by curbing the Employee Retention Tax Credit, which is meant to encourage employers to keep employees on the payroll. This has become an invitation for fraud.
Lawmakers of both parties saw it as a policy victory and a way to show voters that they can actually accomplish something despite the chaos and chaos that has come to characterize the Republican-led House. There is.
“The vast majority of the country really wants to get things done on a bipartisan basis,” Rep. Greg Murphy, R-North Carolina, said in an interview. “We've seen a lot of gridlock because there are people who basically want to say no to everything. And we need to move forward and show people that we can actually govern.” I think.”
In a sign of the political hurdles complicating the bill's path to passage, Mr Johnson brought it to the floor on Wednesday under a special expedited procedure that requires a two-thirds majority for passage. This maneuver allowed him to bypass Republican lawmakers who could have blocked the bill on policy or political objections.
Senate Republicans are also trying to pump the brakes, another sign of the political challenges the policy still faces. The bill is a victory for President Biden and Democrats who have made expanding the child tax credit a key issue, including Sen. Sherrod Brown of Ohio, who is up for re-election this year and is a key target for Republicans in November. It will be.
Sen. Michael D. Crapo (Idaho), the top Republican on the Finance Committee, said Wednesday he still has concerns about the bill, which would allow parents to use previous year's income to request larger loans. It was argued that it contained a provision to do so. That would hinder work and was hoped to be amended in the Senate. Crapo and many other Senate Republicans had previously voted in favor of the same provision in an earlier bill.
“There will be many issues that were not resolved, such as those raised in the House yesterday,” Crapo said. “I think there will be a lot of problems like that, and we have to solve them.”
A group of lawmakers in New York and other high-tax blue states were outraged that a bill that would have increased the state and local tax credit (SALT), which benefits high-income earners, was omitted. New York state Republicans showed their anger Tuesday by temporarily blocking procedural steps to protest.
“As we've said many times this Congress, it's clearly the power of numbers that counts,” said Rep. Mike Lawler, who joined Reps. Anthony D'Esposito, Nick Larota and Andrew Garbarino to leave the party on an unrelated bill on Tuesday. That means there is,” he said. , only switching votes after their case has been made. “But for those of us who have accomplished much, this is an important question.”
After a lengthy meeting Tuesday night, Johnson allayed their concerns by promising to work with them to find a way to address SALT individually, said Athina Lawson, a spokeswoman for the Speaker's office. .
The bill, which the House passed Wednesday, was brokered by two of Congress' top tax officials: Smith and Sen. Ron Wyden, D-Ore., chairman of the Finance Committee. It has the support of the White House, key leaders of both parties on Capitol Hill, and various rank-and-file members. It gained momentum after the Ways and Means Committee approved it with an overwhelming bipartisan majority in January.
Supporters point to the vote and how unlikely it was that a tax deal would be reached as a good sign for that outlook.
“As recently as a month ago, most prophets were saying that this bill was either destined to die in negotiations or to collect dust on the shelf once it was introduced,” Wyden said in a statement Wednesday. That would be fine.'' “Given the dire political climate in our country, it is a true victory to see such strong momentum behind this bill that will help 16 million American children from low-income families get ahead. ”
Republicans argue that the corporate tax cut is worth accepting, and that the child tax credit is a victory for conservatives.
“The child tax credit reform in this bill is a pro-family policy that preserves the child tax credit structure of Trump-era Republican tax reform,” Smith said in a statement. “The child tax credit provisions in this bill help families overwhelmed by inflation, eliminate penalties for families with multiple children, and maintain work requirements.”
The bill would make it easier for families with multiple children to take advantage of the $2,000 per child credit, and would gradually increase the amount that low-income households can claim to match the same amount as higher-income households. The credit also automatically adjusts for inflation, allowing parents to use their previous year's income if they qualify for more credit.
Right-wing Republicans denounced the expansion as a disincentive to work. They also opposed allowing undocumented immigrants with U.S.-born children who qualify under current law to receive the credit.
“I'm not going to support anything that expands the child tax credit that would significantly expand the welfare state,” said Rep. Bob Good, Republican of Virginia and chairman of the House Freedom Caucus. “And I'm not going to support a child tax credit for illegal aliens. I think it's encouraging this illegal invasion, and we should come together as Republicans to stand up against this.”
Progressive Democrats, on the other hand, argued that the bill did not expand tax credits enough and unfairly benefited businesses. That's a far cry from the pandemic-era Child Tax Credit, which put up to $3,600 per child into families' bank accounts and helped lift millions of children out of poverty.
Rep. Rosa DeLauro (Connecticut), the top Democrat on the Appropriations Committee, said on the floor before the vote: “Without ensuring deep tax cuts for middle-class and working-class households, we continue to skew profits to large corporations.'' “I cannot vote in favor of a deal that brings about this.” . “This bill provides billions of dollars in tax cuts for the rich and pennies for the poor.”
