•   
  •   
  •   

Politics Republicans Consider More Generous State and Local Tax Break

05:25  06 december  2017
05:25  06 december  2017 Source:   nytimes.com

Trump after NK launch: US will 'take care of it'

  Trump after NK launch: US will 'take care of it' Trump says 'we will take care of it' following North Korea's latest missile launch, offers no details.Trump told reporters Tuesday that "it is a situation that we will handle.

WASHINGTON — Republicans are considering adding a more generous state and local tax break into the .5 trillion package barreling through Congress, as they try to ease concerns among lawmakers from high- tax states and their constituents, who say they will be penalized by the current

The discussions being held among Republican lawmakers come one day before the Senate is expected to vote to begin the process of aligning its bill with the House-passed legislation.

Kevin Brady wearing a suit and tie standing next to a window: Representative Kevin Brady, Republican of Texas and the chairman of the House Ways and Means Committee, on Tuesday in Washington. © Aaron P. Bernstein/Reuters Representative Kevin Brady, Republican of Texas and the chairman of the House Ways and Means Committee, on Tuesday in Washington.

WASHINGTON — Republicans are considering adding a more generous state and local tax break into the $1.5 trillion package barreling through Congress, as they try to ease concerns among lawmakers from high-tax states and their constituents, who say they will be penalized by the current legislation.

The behind-the-scenes discussions on Tuesday among House and Senate Republicans come ahead of an expected Senate vote to begin the process of aligning its bill with the House-passed legislation. The vote could be held as early as Wednesday.

The Latest: Analysis says tax bill would add $1T to deficit

  The Latest: Analysis says tax bill would add $1T to deficit The Latest on Senate Republicans' tax overhaul bill (all times local):3:53 p.m.A new congressional analysis says the Senate tax package would add $1 trillion to the budget deficit over the next decade, much less than previously estimated. The new analysis by the nonpartisan Joint Committee on Taxation says the tax package would increase economic growth, generating an additional $458 billion in tax revenue. The committee previously estimated that the package would add $1.4 trillion to the deficit.The additional revenue is a boost to the bill but is still far short of the $2 trillion promised by Treasury Secretary Steven Mnuchin.

The state and local tax deduction is estimated to cost .3 trillion over the next decade and its repeal is central to paying for a sweeping tax rewrite unveiled The White House and Republican lawmakers are considering alternatives to an outright repeal, including allowing taxpayers to choose between

Senator Mitch McConnell, Republican of Kentucky, the majority leader, at the Capitol on Tuesday. He called a more generous deduction for local taxes “a kind of reasonable idea.”CreditCreditAl Drago for The New York Times. Republicans Consider More Generous State and Local Tax Break .

Sign Up For the Morning Briefing Newsletter

The state and local tax deduction, or SALT, has been a thorny issue for Republicans, particularly in the House, where numerous members hail from states such as California, New York and New Jersey, where many residents could see their tax bills rise. Twelve of the 13 Republicans who voted against the House tax bill were from those three states.

Right now, taxpayers can deduct state and local tax expenses. Both the Senate and the House bills would significantly scale back that deduction, allowing individuals to write off up to $10,000 in property taxes.

House Republicans are discussing giving taxpayers some kind of option to deduct income taxes, perhaps within that $10,000 cap.

“We’re still looking at how we make tax-reform relief better for those high-tax states,” said Representative Kevin Brady, Republican of Texas and the chairman of the House Ways and Means Committee.

Dueling Tax Plans: Here’s What the Senate and House Have to Resolve

  Dueling Tax Plans: Here’s What the Senate and House Have to Resolve The Senate is poised to pass its tax bill but it still needs to be reconciled with the House-passed legislation, which differs in some significant ways from the Senate plan. Sign Up For the Morning Briefing NewsletterFor months, Republican leaders of the “big six” working group held weekly meetings so that the tax plans that they unveiled would be largely unified, making it possible for legislation to sail through Congress before the end of the year.

Congressional Republicans are considering keeping a limited state and local tax deduction as part of the party’s tax overhaul to avoid losing votes from lawmakers from California and other Republicans are considering giving taxpayers a choice of using the break for property taxes or mortgage interest.

The tax break is important to taxpayers in states and cities with high property taxes and other levies, most of which vote blue though some are represented Republicans from those states worry about taxes increasing on constituents when they can no longer deduct local levies. Asked if he was a “no”

Representative Tom Reed, Republican of New York and a member of the Ways and Means Committee, said there were discussions about adding income taxes into the mix when it comes to the state and local tax deduction.

Donald Trump et al. sitting at a table with a cake: President Trump with Senators Joni Ernst of Iowa and Jeff Flake of Arizona on Tuesday at the White House. © Doug Mills/The New York Times President Trump with Senators Joni Ernst of Iowa and Jeff Flake of Arizona on Tuesday at the White House.

“I think there’s a natural conversation being had in regards to expanding the state and local tax deduction from not just property,” he said.

Significant changes to the tax bill will probably lean in favor of the Senate because of its narrow majority and strict budget rules, which require that the bill add no more than $1.5 trillion to the deficit over a decade in order to pass along party lines.

Some Republican senators suggested Tuesday that they were open to making changes to the bill that they passed in the early hours of Saturday morning, but that they would need to find ways to pay for those changes.

Politicians are selective about when debt and deficits matter

  Politicians are selective about when debt and deficits matter If you're a normal person who pays attention to politics, you'd be forgiven for thinking that Washington can't decide whether deficits are bad or not. Well, I have one easy trick that will help you make sense of it all. In Washington, when you hear people complain that this or that piece of legislation will "If you're a normal person who pays attention to politics, you'd be forgiven for thinking that Washington can't decide whether deficits are bad or not. Well, I have one easy trick that will help you make sense of it all.

Republicans would have to rethink much of their tax plans, which would currently help the wealthy in six main ways: cutting the top income- tax rate Before tax reform can proceed, congressional Republicans need to adopt a budget including reconciliation instructions that would set the

Whether you agree with more government spending or tax breaks for corporations, each party's agenda will affect your taxes . The Republicans assert that they "support giving all taxpayers the option of filing under current rules or under a two-rate flat tax with generous deductions for families.

“I’m open to trying to make this bill fairer for the upper-middle-income taxpayers in high state and local tax states like California and New York,” said Senator John Kennedy, Republican of Louisiana. “I would like to help everybody, but again, you have to be mindful of the impact on the deficit and on the nation’s debt.”

Another provision being looked at for revision is the corporate alternative minimum tax, which was inserted into the Senate bill at the last minute to help pay for the tax cuts. But its insertion has raised concerns among business groups, which say it will undercut their ability to use valuable tax breaks like the research and development tax credit.

Mr. Kennedy said that “in a perfect world,” the corporate alternative minimum tax would be repealed, but he said that deficit concerns might not allow that to happen. “That’s only one half of the equation — the other half is can we afford it?” he said.

House Republicans fully repealed the corporate and the individual alternative minimum tax in their bill, and Mr. Brady made the case on Tuesday that doing so was the right decision.

2 questions loom over House-Senate talks on GOP tax bill

  2 questions loom over House-Senate talks on GOP tax bill Two looming questions threaten to snag the seemingly smooth trajectory of the Republicans' massive tax legislation now in its final leg in Congress. How to satisfy demands of the rebellious GOP lawmakers from high-tax states who demand concessions over a cherished deduction? And how to pay for those concessions?Even President Donald Trump has dropped his stubborn resistance to a smaller cut in the corporate tax rate as Republican leaders consider it as a way to pay for the House GOP rebels' demands.About two dozen House and Senate lawmakers are in talks to iron out differences between the two bills.

And many are asking why as they assess how a new federal income tax law that caps state and local tax deductions will shake out for them. And although California has generous eligibility requirements for Medicaid, spending on the health program for the poor and payments to enrollees were average

Republican tax negotiators stress how much they want tax reform to help the middle class. And they note that the highest income households tend to benefit most Related: Who pays if Congress kills the state and local tax deduction. Some will argue that a six-figure income up to 0,000 should never

“Both of them are very costly, and they add complexity,” he said.

Lawmakers are also considering raising the proposed corporate tax rate to 22 percent from a proposed 20 percent to help pay for additional changes. However, Senator Mitch McConnell, Republican of Kentucky and the majority leader, was cool to the idea on Tuesday.

“I think the corporate rate should be at 20,” Mr. McConnell said of the rate, which is currently 35 percent. “Both bills reflect 20 percent.”

The preliminary deliberations come as Congress faces a Friday deadline to extend government funding while it rushes to get the $1.5 trillion tax cut legislation to President Trump’s desk before Christmas.

Despite the optimism among Republicans about their tax plans, some data points on Tuesday suggested reasons for skepticism.

A survey of chief executives from the Business Roundtable found that while companies expect to see higher sales and to make more capital investments in the next six months, they anticipate that the pace of hiring will slow.

Arguments from Democrats that the Republican tax plan will mostly benefit the rich and big companies also appear to be taking hold with the general public. A Gallup survey released Tuesday showed that just 29 percent of Americans support the proposed tax changes in the bills.

Protesters organized by progressive groups packed the halls of the Capitol complex on Tuesday wielding signs that read, “Don’t cut health care to pay for corporate tax cuts.”

As the tax code rewrite approaches the finish line, Mr. Trump has taken on the responsibility of making sure that the momentum does not stall.

On Tuesday, he hosted a “taxpayer family event” at the White House for four families from across the country to talk about why they want lower taxes. Mr. Trump also invited Republican senators over for lunch to make sure that the process was moving forward smoothly.

“I call it ‘the mixer,’” he said of the final steps of aligning the House and Senate tax bills. “It’s a conference where everyone gets together and they pick all the good things and get rid of the things they don’t like.”

My fellow Republicans, a Democratic wave is coming unless we act right now .
Republicans lost Tuesday in an Alabama U.S. Senate race for the first time in 25 years. Republicans lost the Virginia governorship last month, despite Ed Gillespie getting more votes than any Republican gubernatorial candidate in the state’s history. The GOP also lost 14 Virginia House of Delegates seats, and four races are still being recounted – enough for Republicans to potentially lose control after 17 years in the majority.In New Jersey, an unpopular Republican governor doomed the GOP candidate to a decisive defeat with 42 percent of the vote.

—   Share news in the SOC. Networks

Topical videos:

This is interesting!