House Republicans are struggling to pass a tax package in their waning days of congressional control, as some of their members press to include more significant tax cuts in a package designed to fix errors in their 2017 tax law, among other changes.
GOP leaders will spend coming days scrambling to address a variety of concerns from lawmakers, some of whom are reluctant to fall in line on a piece of legislation that may be unlikely to pass the Senate.
“We have time to start working on this today, so we’re going to continue to work on this,” said House Ways and Means Committee Chairman Kevin Brady (R-Tex.), who is spearheading the legislation.
The tax package would extend about 30 temporary tax breaks that are set to expire, as well as implement new retirement provisions that have earned bipartisan support.
The bill would also fix several drafting errors in the 2017 Republican tax law including a provision that accidentally penalized the restaurant and retail industry — and includes a bipartisan overhaul of the Internal Revenue Service. It would cost about $54 billion over 10 years, according to Congress’s nonpartisan scorekeeper.
Brady and other House Republicans expressed confidence they would find the votes to pass the tax package. Leaders will aim to bring the bill up next week, but Brady said there was no specific timetable. The legislation was expected to be on the House floor on Friday.
“I believe we have strong support,” Brady said. He said time-consuming obligations related to selection of committee leaders for the next Congress had prevented him and others from focusing on the tax bill, but that would now change. “So this is really a chance to begin to focus on the goal.”
The bill faces an even steeper climb in the Senate, where it needs Democratic votes to pass. Sen. Ron Wyden (D-Ore.), the leading Democrat on the Senate Finance Committee, has pilloried Brady’s legislation and criticized House Republicans for not consulting Senate Democrats. A spokeswoman for Wyden said Friday there are no ongoing negotiations between the House and Senate about the bill.
Rep. Tom Reed (R-N.Y.), a member of the House Ways and Means Committee, said some House Republicans have called for the legislation to do more to permanently cut taxes. House Republicans have pushed for the legislation to permanently repeal the medical device tax, an excise tax passed as part of the Affordable Care Act that has been widely attacked by conservatives, Reed said.
“There’s always a desire to expand it even more,” said Reed, who expressed confidence the bill would pass soon. “There’s still some loose ends . . . but a lot of these extenders have to be addressed.”
Rep. Leonard Lance (R-N.J.) also cited concern over medical device tax and said other members shared that concern. “I hope that the bill might include postponement of the medical device tax. As I understand it, it’s not in the bill,” Lance said. “It is a concern, and I might vote for the bill anyway but I expressed that as a concern.”
Some conservative House members have also expressed opposition to some of the temporary extensions of tax breaks in the Brady package. The bill includes a tax incentive for biodiesel that would cost billions, as well as a $150 million annual extension for alternative fuel vehicles. The Brady package has other tax extensions for renewable power construction and energy efficient homes.
“Some of the conservative members believe that it’s government picking winners and losers — there’s a strong conservative view government should not be involved in energy industrial policy,” said Brian Riedl, senior fellow at the Manhattan Institute who has talked with House Republicans about the bill. “Those policies have always been controversial among conservatives.”
The Joint Committee on Taxation, Congress’s official scorekeeper, found in a report released Thursday the bill would add $54 billion to the federal deficit over the next 10 years. The Congressional Budget Office similarly found the bill would cost $55 billion over the same time period.
The bulk of that money — about $30 billion of the $54 billion — comes from extensions of the roughly 30 temporary tax breaks. Many of those provisions are only extended in the package for one year alone, so the 10-year cost is likely to be much higher if lawmakers continue to renew the breaks in future years. That has elicited the concern of some deficit hawks, who warn America’s deficit is already approaching historically high levels.
Rep. Richard E. Neal (D-Mass.), the ranking Democratic member on the House Ways and Means Committee, said Brady did not consult with House Democrats before releasing the legislation. He also criticized House Republicans for not holding hearings on its various measures.
“It really would be very helpful if we had occasionally a hearing on some of these measures, or a conversation or notification,” Neal said about the GOP decision to pull the bill. “I think that it really deserves an incomplete.”
Erica Werner contributed to this report.