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Impatience over stalled tax deal grows in Senate

Supporters of the bipartisan tax deal that passed the House in January are growing impatient as Republican opposition to a bill to expand credit for working families stalls the bill in the Senate.

The agreement, known as the American Families and Workers Tax Relief Act, expands and rescinds the Child Tax Credit (CTC), which has lifted millions of children out of poverty during the pandemic, to help pay for it. It is a combination of established business tax deductions. For Trump’s 2017 tax cuts.

These deferrals include deductions for research and development expenses, acceleration of depreciation schedules for plant and equipment, and deductions for interest payments, which are beneficial for companies that purchase assets with debt.

Repealing the employee retention credit, which lawmakers say is rife with fraudulent claims, would cover almost all of the $78 billion in tax credits included in the bill.

The deal’s business loans have bipartisan support, but Republicans are wary of moving forward with the bipartisan deal ahead of the November election. A landslide victory for Republicans could give them the power to enact a major new tax bill and strengthen Trump-era tax cuts that are set to expire in 2025.

Sen. Mike Crapo (Idaho), the top Republican on the Senate Finance Committee and the lead negotiator in the negotiations, told The Hill on Tuesday that negotiations remained “stalled,” adding that Democrats “wanted to pass the bill.” “They’re just trying to cram it all in,” he said. floor. “

“Look, if they succeed in pushing the bill through the floor, of course there’s no point in discussing negotiations,” Crapo said. “If that is not successful, we hope that negotiations will resume.”

While the proposal is a significant tax bill in scope and design, it is almost certainly smaller in size than the tax bill expected to be introduced in Congress next year, when individual provisions of the Trump tax cuts expire.

Republicans generally want to extend the cuts across the board, while Democrats are likely to want to amend some provisions and eliminate others.

The Trump tax cuts would increase the federal deficit by about $1.5 trillion by 2027, according to the Joint Committee on Taxes, so no matter what the outcome of post-election negotiations in 2024, the proposal would be a bigger deal than the current tax deal. could be easily incorporated.

Senate Finance Chairman Ron Wyden (D-Ore.), one of the bill’s lead authors, said in a statement Monday that he had amended the bill to align with Republican demands for how far back the family credit should extend. appealed to Republican senators who opposed it. Apply.

“Senator Crapo did not accept that offer,” Wyden said Monday. “The changes he called for instead would crush the bill’s chances of passage and leave far too many children living in poverty. But what I want the rest of the Senate to know is: , my suggestion still stands.”

“What I’m saying here is this can’t wait,” he added.

A Republican aide on the Finance Committee told The Hill that Wyden and Crapo did not speak during the two-week spring recess. Aides said the senator declined to comment on Wyden’s remarks.

But Wyden told The Hill on Tuesday that he spoke with House Ways and Means Committee Chairman Jason Smith (R-Missouri), who together put together the first bipartisan tax deal as they worked to advance the bill. He said he did.

“I had a long conversation with Chairman Smith last night, and we’re going to do everything we can,” he said, adding that both parties are lobbying Republican senators as part of the effort.

“He’s been very involved. We’re always talking, he’s been in contact with a lot of Senate Republicans, and Senate Republicans have been coming to me and asking questions. ” he said.

Rank-and-file Republicans have so far been in no rush to heed Wyden’s call. Some choose to take cues from the finance committee leadership instead.

“I think I just have questions about some of the provisions that Sen. Crapo proposed, and I know they’re working on it. So we just have to see now. I’m kind of on hold. Yes,” Sen. Shelley Moore Capito (R-Va.) told The Hill about the bill last week.

Sen. Todd Young, R-Ind., who supports the bill, said he is encouraged by the negotiations but has questions about where the bill is headed.

“I don’t know if they’re actually very continuing…but I hope they are,” he told The Hill last week.

Even Senate Republicans who support parts of the bill are pushing for further changes.

Sen. Josh Hawley (R-Missouri), one of the few Republicans who supports expanding the child tax credit, objected to the return of the research and development tax credit. He said unless an amendment is made to include provisions reauthorizing compensation for radiation exposure victims, the focus of a long-running dispute between him and Senate Minority Leader Mitch McConnell (R-Ky.). He added that he had no intention of voting in favor of the bill.

“I think that’s the only way to get the bill passed,” Hawley said Thursday. “If we don’t, I think we’re dead here. I’ve been listening to my Republican colleagues for weeks on end, and there’s been a lot of negative feedback on this bill.”

Other leading Republicans also firmly oppose the bill.

Sen. Thom Tillis, RN.C., a member of the Finance and Banking Committee, said he was actively trying to “kill” the proposal for a variety of reasons, including retroactively expanding the CTC and canceling the employee retention credit. “There is,” he said. An important source of revenue for this bill.

“There’s an issue with the amount of the payment, there’s an issue with the timing, because next year there’s a big cliff in terms of tax increases and we felt it was time to get everything together,” he said. “We’re talking billions of dollars in this tax deal. Next year it’s going to be trillions of dollars. So I think we’ll have to wait and negotiate next year.”

Mr. Tillis echoed Mr. Capito, suggesting that Republican support for the bill rests with Mr. Crapo.

“That can’t happen.” [get] myself [to a] ‘yes. ‘If we negotiate with Crapo, they might say yes. “If we don’t do that, I think Republicans will probably block this policy from moving forward,” he said.

Despite the obstacles the bill faces, Democratic enthusiasm for the proposal remains undiminished.

Sen. Tim Kaine (D-Va.) told The Hill that the Senate “ [it] Please go to the floor and vote. ”

“We’re going to show some respect to the House by taking up a bipartisan bill.” [passed] “We have a huge lead,” he said last week.

Sen. Michael Bennet (D-Colo.), a longtime supporter of the child tax credit, said the bill’s passage in the House by a 357-70 vote is reason enough to bring it to a vote in the Senate. Stated.

“I think it’s very rare to get more than 350 votes in the House, and I think we have a lot of support in the Senate. So we put it on the floor and people can see how Let’s see if you vote,” he said last week.

Big businesses are also keen to move the bill forward.

“We are clearly at a critical moment,” Neil Bradley, chief policy officer at the U.S. Chamber of Commerce, said in an interview with The Hill.

“If we can’t get this idea across the finish line within the May work period, there is little reason to believe it will happen this Congress,” he said.

Copyright 2024 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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