Senate tax bill turmoil: Republicans hunt for new revenues to satisfy deficit hawks

The White House and congressional leaders released a framework for tax changes, but many key details have been left to tax committees. Here’s how that process is working.

Jeff Dionise, Ramon Padilla, Paul Singer and Herbert Jackson, UT

WASHINGTON — Republican plans to overhaul the tax code nearly derailed in the Senate Thursday afternoon and remained wobbly into the evening after a solution leaders were hoping to use to satisfy deficit hawks unraveled.

The result had Republican senators debating in private how to rewrite the bill again, possibly to include a new minimum tax on corporations and wealthy people in some future year to offset lost revenue from lowering tax rates and increasing some credits next year.

“That’s under discussion now,” said Sen John Hoeven, R-N.D. late Thursday. “So it hasn’t been nailed down, but that’s one possibility.”

Sen. Tom Tillis, R-N.C., said Republicans were looking to raise between $370 billion to $400 billion in tax revenue but they have not figured out when those hikes would have to kick in. He said it’s delicate negotiation in which every change could win one vote only to lose another.

“It’s a zero-sum game,” Tillis said. “So what we’re trying to do right now is get everybody to a point where nobody’s going not get exactly what they want but enough for us to get the bill passed.”

Sen. Bob Corker, R-Tenn., had said in October he would not vote for the tax bill if it added to the deficit. Many Republican supporters of the bill and officials in President Trump’s administration have said it would produce so much economic growth that tax cuts would pay for themselves.

Corker was skeptical, but voted in the Budget Committee on Tuesday to send the tax bill to the floor after saying he had assurances from Senate leaders the bill would be revised to include a “trigger” that would automatically raise taxes if anticipated economic growth did not materialize.

But on Thursday — the same day the nonpartisan scorekeeper for tax bills said the Republican plan would add $1 trillion to the national debt even after accounting for growth — the trigger plan collapsed. The Senate parliamentarian concluded it would violate the special rules Republicans are using to pass the tax bill with no Democratic support.

Those rules prohibit Democrats from using a filibuster, which would require 60 votes to overcome, so Republicans can pass the bill with votes from 50 of their 52 members and the support of the vice president. But those same rules also come with tight restrictions about what can and cannot be in the bill.

“It doesn’t look like the trigger is going to work, according to the parliamentarian,” said Sen. John Cornyn of Texas, the No. 2 Republican leader.

In a dramatic moment in the late Thursday afternoon, Corker and fellow Republicans Jeff Flake of Arizona and Ron Johnson of Wisconsin held back their votes for an hour before joining their colleagues in voting down a Democratic effort to send the bill back to the Senate Finance Committee.

For a moment, it appeared they could stop the bill, which had been headed toward potential passage by this weekend. Even though the bill survived, its fate remained unclear because of confusion about the next step.

Opposition from Corker and Flake, who have voiced concerns about the debt, and Johnson, who wants changes to the way businesses are taxed, would be enough to kill the bill if Democrats remain united against it.

But satisfying Corker and Flake by amending the current bill might not get the needed votes, especially as conservative groups try to pressure their allies not to agree to any future tax increases.

“There’s a lot of plates spinning, some of which I can see, some of which are going on in other discussions,” said Tillis.

The Club for Growth, for example, issued a vote alert after the standoff on the Senate floor that “urges all Senators to vote NO on any amendment that will increase any of the corporate or individual tax rates established in the proposal that was approved by the Senate Budget Committee.

Senate Republicans are trying to pass the tax bill this week. The House has passed a version of its own and has scheduled a vote for Monday to set up a conference committee to resolve the differences between the two bills.

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