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GOP “Lovefest” Or McCain Mayhem: McConnell Says Crucial Procedural Vote On Tax Bill Coming Later Today

Courtesy of ZeroHedge. View original post here.

Just yesterday a 12-11 party-line vote in favor of the tax reform bill by the Senate budget committee allowed Mitch McConnell to breathe a temporary sigh of relief after earlier objections by GOP members left many wondering whether the bill would even make it out of committee. 

Now, the controversial legislation is set for its first key test before the entire Senate after McConnell just confirmed that a crucial procedural vote intended to allow debate on the bill has been scheduled for later this afternoon.

As expected, McConnell says the Senate will vote later today on the Motion to Proceed to the GOP tax reform bill.

— Frank Thorp V (@frankthorp) November 29, 2017

Of course, the bill will need at least 50 votes to pass, with Vice President Mike Pence breaking a potential tie; Republicans hold 52 seats in the chamber, and no Democrats are expected to support the bill.

As the Wall Street Journal notes, key, last-minute modifications to the bill that allow for tax increases in the event of deeper deficits managed to attract the support of several key Senators who had previously been on the fence.

One group of senators that were on the fence and now appear set to support the bill are lawmakers concerned about the federal deficit. Led by Sens. Bob Corker (R., Tenn.), James Lankford (R., Okla.) and Jeff Flake (R., Ariz.), the group has been working on a plan to trigger automatic tax increases if the tax cuts lead to deeper deficits. By Wednesday, the deficit hawks sounded optimistic and said the details of a deal were closer to being worked out.

New details about the design of the fallback plan could mitigate some concerns. Republicans briefed on the plan said that it could be designed in a way to keep the backup plan from activating in the event of an economic recession. For it to work, the government would have to distinguish between a slowdown in tax revenue caused by tax cuts and a slowdown that is a normal feature of the economic cycle.

“We’re writing in a protection from recession so that way if there is a recession, the trigger turns off,” Mr. Lankford said on CBS. “The second part of that is if we do this large tax cut and we broaden the base of what’s happening economically, we better not have a recession at that point. This should actually charge up the economy.”

Meanwhile, Trump seemed confident yesterday after describing a GOP meeting on the legislation as "somewhat of a lovefest."

Trump calls today's meeting with Republican senators "very special" and "somewhat of a lovefest" pic.twitter.com/QMc5kzBkz1

— Aaron Rupar (@atrupar) November 28, 2017

Of course, not all Republicans are onboard with the "lovefest" just yet at Senator Steve Daines (R-MT) still has some reservations over the treatment of pass-through income and Senators Mike Lee (R-UT) and Marco Rubio (R-FL) would like a slightly higher corporate tax rate to help fund a larger child tax credit for low-income families.

Still, not every Republican is ready to vote yes. Sen. Steve Daines (R., Mont.), who is concerned about the treatment of partnerships and other “pass-through” entities whose earnings pass through to individual owners’ tax forms, said that he wasn’t quite ready to cast a vote to allow the tax debate to begin.

Separately, Republicans were planning to try to make more changes to the tax bill by offering amendments later this week.

Sens. Mike Lee (R., Utah) and Marco Rubio (R., Fla.) are proposing an amendment to the tax bill that would increase the child tax credit for low-income families and pay for it by setting the corporate tax rate at 22%, instead of 20%.

That amendment would make the child tax credit fully refundable against payroll taxes and index the tax credit to inflation. Refundable tax credits go to households that don’t pay income taxes.

Passage of this key procedural vote today could setup the Senate to pass whatever modified version of the bill comes out of debate by Thursday or Friday of this week.

We will provide updates on this crucial procedural vote as they develop throughout the day.


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