An unusual alliance of Republicans and some Democrats opposes the bill in the House. And if it passes, the tax package's future is uncertain in the Senate.
WASHINGTON — The Republican-led House is targeting a vote as early as this week on a bipartisan bill to expand the child tax credit and provide a series of tax breaks for businesses, three sources said.
The $78 billion package, which cleared the Ways and Means Committee on a 40-3 vote, could come up on Wednesday, said one of the sources, who added that the timing is not locked in. GOP leadership notified members that it "may be considered" this week.
The legislation presents a rare opportunity for a historically unproductive Congress to deliver a win for constituents. But it faces some obstacles in the House, where it will likely be fast-tracked and require a two-thirds vote to pass, and uncertainty in the Senate.
“There is strong interest in getting this done. These are proven pro-worker, pro-family policies that help extend some of the most economically beneficial provisions of the Republican tax cuts from 2017,” said Ways and Means Chair Jason Smith, R-Mo., an author of the bill. “A 40-3 vote in committee reflects the strong interest from all sides in having a vote on the House floor as soon as possible.”
Some liberals have objected to the tax cuts for businesses, which include breaks for research and development, and small business expensing. All three “no” votes in committee came from Democrats, though many others in the party are supporting the package due to the provisions for families with children, which are projected to cut child poverty.
Among Republicans, there is some discontent from various corners.
According to two sources, a private call on Thursday between Smith, Speaker Mike Johnson, R-La., and a group of Republicans in the "SALT" caucus grew heated amid complaints that the bill doesn't raise the cap on federal deductions for state and local taxes — commonly known as SALT — a priority for some GOP members from New York and California. (Taxpayers in areas with higher state and local taxes are likelier to use SALT deductions than low and middle-income Americans elsewhere.)
Leading the objections to the lack of SALT relief was Rep. Nick LaLota, R-N.Y., whose Long Island constituents were hit by the $10,000 cap on SALT deductions imposed by the 2017 Trump tax law. He raised his voice on the call, according to one of the sources with knowledge of what transpired. Both sources said Smith held his ground and defended the decision not to expand the SALT cap in the tax package; most congressional Republicans support keeping the cap in place. The call was first reported by The Hill.
“I’m a no on the tax package that does not have adequate relief for SALT,” LaLota told reporters. “I’m willing to fight for my constituents by voting no.”
But it's not clear that other pro-SALT Republicans will vote against the bill. That includes Rep. Marc Molinaro, R-N.Y.
“We still remain committed to extending the benefit to all middle-class families,” Molinaro said. “I’m hopeful we can come up with a solution, but the child tax credit is a very promising extension.”
Rep. Chip Roy, R-Texas, a member of the hard-right Freedom Caucus, has also blasted the legislation, arguing that it could benefit children of undocumented immigrants and labeling fellow Republicans "whores" for businesses.
“I’m sick of these gutless cowards in Washington. You know what we’re gonna put on the floor next week, Jimmy? A tax cut bill for corporations," Roy said on the podcast "Fox Across America w/ Jimmy Failla," which was posted Thursday. "Because Republicans are whores for endless wars and corporations. That’s it. That’s what they stand for. And I’m not gonna pretend that it’s something else."
One House GOP aide noted that the business provisions are about reviving expired tax breaks from the 2017 GOP tax law, calling them “a key part of Trump’s economic legacy.” Roy praises the Trump tax law on his campaign website as “a great step forward for economic growth.”
Senate Finance Chair Ron Wyden, D-Ore., who co-authored the new tax package, rejected conservative claims that it would “empower illegals” to get benefits. “Factually untrue. There is no change in our bill from the Trump policy of 2017, which doesn’t do that,” he said.
Overall, proponents feel confident that the objections aren't widespread and that the bill has the votes to sail through the House.
What happens next is less clear.
In the Senate, the bill will require 60 votes to defeat a filibuster. Minority Leader Mitch McConnell, R-Ky., hasn't weighed in, and his office said he's deferring to Sen. Mike Crapo, R-Idaho, the ranking member of the Finance Committee, to handle it for Republicans. Crapo told NBC News he isn't ready to support the bill and wants changes to it, though he declined to say what sort of changes.
Wyden said a successful House vote could pressure the Senate to move quickly to pass the bill as tax filing season gets underway.
“It’s a very difficult political climate right now. They take it up. And if it gets a big vote ... then my view is this will change considerably,” Wyden said. “Because it won’t be so much Democrats and Republicans debating. It’ll be people saying a bunch of hungry kids need that financial help, that they’re from a big family and they haven’t been getting a fair shake in terms of assistance. Or a small business who needs that R&D incentive to make payroll.”
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