Republican tax plan moves through Congress

Next week marks the one-year anniversary of the Republican tax bill. On December 22, 2017, President Donald Trump signed the Tax Cuts and Jobs Act, shrinking the corporate tax rate from 35 to 21 percent and cutting taxes on private businesses by about 20 percent.

When Trump signed the bill that morning in the Oval Office, he boasted about the gains it would provide for all Americans. He claimed that corporations were already “giving billions and billions of dollars away to their workers” as a result of the $1.5 trillion tax cut package and pointed to a handful of big companies that promised to raise wages and give employees $1,000 cash bonuses — among them Walmart, Bank of America, and Comcast.

Frustrated with the media coverage of Sen. Marco Rubio’s (R-FL) viral critique of the Republican tax bill, Rubio’s office has published the rest of the senator’s comments, which are still a scathing critique of the law.

In newly published remarks, Rubio undercuts the true impact of the corporate tax cut, the central part of the Republican tax reform package, and seemingly questions his Republican colleagues’ dedication to helping the working class.

After congressional Republicans passed their massive tax reform bill late last year, Americans felt the impact quickly.

Republicans passed their tax package in mid-December, and the bill’s statutory language meant it went into effect on January 1, 2018. The sweeping overhaul of taxes reduced rates for corporations and individuals (although individual tax cuts will eventually expire) and repealed the Affordable Care Act’s individual mandate, effectively kicking 13 million people off their insurance, according to the Congressional Budget Office.

Right after Republicans in Congress passed their tax bill, lowering tax rates on corporations, companies delivered a very public thank-you: a series of bonus and investment announcements. It was a major PR opportunity for both corporate America and the GOP, meant to show that American businesses were sharing their billions of dollars in tax cut savings with their workers and the broader economy.

But over the next few months, the real winners from the corporate tax cut became clear — not workers and consumers, but shareholders. Companies have boosted dividends and stock buybacks. A stock buyback is when a company buys back its own shares from the broader marketplace.

The tax law Republicans passed this week increases the deficit by $1.5 trillion inside the 10-year scoring window as assessed by conventional methods. The Joint Committee on Taxation, whose director was appointed by Republicans, was willing to find that on a dynamic basis the deficit increase might be “only” $1 trillion.

And the public debate has generally proceeded by taking the $1.5-1 trillion figures as representing the pessimistic pole of the debate, while Republicans senators insist that the real number is much lower. Erstwhile moderate Susan Collins professes that the tax bill will boost growth so much as to pay for itself, and her colleagues apparently agree.

Republicans have made a lot of promises on their tax bill.

They’ve said their bill will simplify the tax code by having American taxpayers file their taxes on a postcard, and that the tax cuts will pay for themselves, unleash corporate investment, and spark unprecedented economic growth. President Trump and America’s highest earners won’t benefit from the tax bill at all, he said.

President Donald Trump and Republicans promised a tax bill by Christmas, and on that front they have delivered.

On Friday, Donald Trump signed the Tax Cuts and Jobs Act into law, a $1.5 trillion proposal that gives corporations a massive permanent tax break, temporarily cuts rates for individuals, and repeals the Affordable Care Act’s individual mandate — a move that is estimated to leave 13 million fewer insured in the next 10 years.

On its own, the Republican tax bill would trigger something President Donald Trump promised would never happen: an automatic $25 billion cut to Medicare. Now, Republicans are making sure it won’t.

In a last-minute dash to keep the government open, Republicans are set to vote on a stop-gap federal spending bill Thursday that will include a waiver to the “pay-as-you-go,” or PAYGO rule — a 2010 law that says all passed legislation cannot collectively increase the estimated national debt.

The Republican-controlled Congress is poised to pass a tax bill riddled with ambiguities, loopholes, and giveaways. The rules draw new lines that favor some taxpayers but not others — and in many cases the bill creates these preferences for no discernible policy reason.

Last-minute additions to the bill stripped out a few peculiarities — an earlier House version would have let business owners lower their taxes just by limiting their active involvement in the business, for example — but final negotiations also brought new and unexpected benefits.

With the passage of their tax overhaul, Republicans in Congress have repealed the Affordable Care Act’s individual mandate, delivering their first major blow against the law and imperiling the insurance marketplaces where millions of Americans buy health coverage.

The tax bill, which President Trump will soon sign into law, ends the penalty for Americans who don’t have health insurance. Repealing the mandate — which is the gear that makes the Affordable Care Act tick — is estimated to save more than $300 billion over 10 years, but only because millions fewer Americans would have health insurance, according to the Congressional Budget Office. It also means higher premiums, because the younger and healthier people who have an incentive to buy insurance rather than pay the mandate would be expected to exit the market while the sicker people stay in.

Having passed their tax bill, top Republican leaders have already identified the next frontier for 2018: a push to enact sweeping budget cuts on programs the poorest Americans depend on.

House Speaker Paul Ryan and other top Republican leaders, fresh off a tax bill that is estimated to add at least $1 trillion to the national debt, are already sounding the alarm about an out-of-control deficit problem. Their targets for closing the gap include Social Security, Medicare, and food stamps.

Republicans have managed to take a tax plan that was already tilted heavily toward corporations and the wealthiest Americans and shift the balance even further in favor of the rich.

The story of the Republican tax overhaul has been its pinpoint targeting of the biggest benefits to the rich and to businesses. As Alvin Chang and I wrote previously, America is in the midst of a shift toward extreme income and wealth inequality. The GOP tax plan would make that problem — and most Americans regard it as a major problem — even worse.

Compared to the last-minute Senate drama during the attempt to repeal Obamacare this summer, the GOP tax bill sailed through the chamber late Tuesday night.

Just like the health care vote, there were a small number of Republican senators who seemed like they might hold out. But unlike last time, Senate leadership managed to successfully cut deals with these senators to secure “yes” votes.

Senate Republicans voted late Tuesday night to approve their final tax overhaul, paving the way for the bill to reach President Donald Trump’s desk and be signed it into law.

In the end, every Republican senator backed the plan, with the exception of Sen. John McCain, who was recovering from cancer treatment in Arizona. The only Republican who had opposed the earlier version, Sen. Bob Corker of Tennessee, reversed himself and supported the final bill. Every Senate Democrat opposed it.

Some procedural hiccups are going to delay the tax reform bill getting to President Trump’s desk by a few hours.

The Senate parliamentarian has said a few minor provisions in the legislation — including, no joke, its title — violate the chamber’s procedural rules. Those provisions will have to be changed in the bill before the Senate can pass it. This will then will also require the House to pass the legislation again, even though the House already cleared the bill comfortably earlier on Tuesday.

Wells Fargo in 2016 was fined $185 million for issuing millions of fake credit card accounts. In 2017, it was caught overcharging clients on currency trades and improperly charging homebuyers to lock into low mortgage rates.

And in 2018, it could be about to get the best tax deal of all the big banks.

Far and away the biggest complaint that Americans have with the tax system, poll after poll finds, is that big corporations don’t pay their fair share. So it’s more than a little startling that the tax bill Republicans are about to pass would not only slash the corporate tax rate across the board but also add a big incentive for companies to stash money overseas.

The bill would take currently untaxed profits of US companies being stored abroad — profits that would normally be taxed at a 35 percent rate upon being brought back to the US — and tax them at new ultra-low rates: 8 percent for profits invested in real estate and other hard assets abroad, and 15.5 percent for profits in cash and stock and other liquid assets.

House Republicans voted Wednesday to approve their final tax package, handing it off to the Senate, sending the bill to President Donald Trump’s desk.

In the end, only a dozen House Republicans, along with every Democrat, voted against the tax package; 227 Republicans voted for it. The Senate cleared the bill the night before; the House, which had actually passed the bill earlier Tuesday, had to revote after some technical issues required a few provisions to be stripped out in the Senate.

The House and Senate are poised to pass the Tax Cuts and Jobs Act, a tax reform bill that includes a massive, permanent corporate tax cut, temporary cuts for individuals, primarily benefiting the wealthiest Americans, and a repeal of the Obamacare individual mandate.

But the final version of the legislation omits some of the unpopular — and controversial — provisions that appeared in the House GOP’s first pass at the bill.

Controversy has grown over a last-minute addition to Republicans’ tax bill that gives real estate owners like President Donald Trump — and perhaps Sen. Bob Corker (R-TN), who suddenly came around to supporting the bill on Friday — a major tax break.

The provision essentially extends a new tax break for “pass-through” businesses, like partnerships and LLCs, to real estate investors — personally benefiting some lawmakers and exacerbating the already favorable rates for the wealthy in the bill.

Congressional Republicans have struck a deal on tax reform, enabling them to pass a final bill shortly after the House and Senate each passed its own proposal.

The combined proposal would slash corporate tax rates permanently, offer temporary cuts for individuals, and repeal the individual mandate in Obamacare, a $338 billion health care cut that leaves 13 million more people uninsured by 2027. The result is that by that year, when the individual cuts expire, most Americans will be worse off due to higher taxes and lower health care coverage, while rich people who own shares in corporations will continue to benefit.

By 2027, more than half of all Americans — 53 percent — would pay more in taxes under the tax bill agreed to by House and Senate Republicans, a new analysis by the Tax Policy Center finds. That year, 82.8 percent of the bill’s benefit would go to the top 1 percent, up from 62.1 under the Senate bill.

And even in the first years of the bill’s implementation, when it’s an across-the-board tax cut, the benefits of the law would be heavily concentrated among the upper-middle and upper-class Americans, with nearly two-thirds of the benefit going to the richest fifth of Americans in 2018.

With the GOP tax bill both heading toward passage and very unpopular, several readers have naturally asked about the prospect of Democrats simply repealing this thing if they do well in 2018 and 2020.

In general, it’s rare to see major legislation seesaw like that. (Even back when Republicans were committed to repealing Obamacare, they were actually keeping tons of the law’s consumer protections for employment-based care on the books, along with many other provisions.) I don’t think the Tax Cuts and Jobs Act will be an exception to that rule.

According to a poll from Public Policy Polling, 57 percent of Americans now approve of the Affordable Care Act. Only 29 percent approve of the GOP’s tax cuts.

Reflect on those numbers for a moment. Republicans have managed to make tax cuts less popular than Obamacare. It’s impressive.

The final draft of the Republican tax bill kills a proposed tax on tuition waivers. It is a big win for grad and PhD students, and higher ed advocates who opposed the measure.

House Republicans’ tax bill included a provision that would count tuition waived by universities as taxable income, meaning that graduate students could be on the hook for thousands of dollars more in taxes each year.