Congress Attempts Long-Shot Tax Bill In Election Year

The Republican-controlled House last week voted to approve a $78 billion tax package that would expand the child tax credit, NBC News reported.

The bipartisan legislation passed the House 357-70 under the fast-track process requiring a two-thirds majority. The measure garnered broad support from both sides of the aisle with 169 Republicans and 188 Democrats voting in favor with 23 Democrats and 47 Republicans opposed.

The bill now moves to the Senate where its future remains uncertain. The legislation would require a 60-vote majority to pass, and as it stands, it is not clear if enough senators support the measure.

The legislation faces opposition from progressive Democrats over the tax breaks given to businesses and conservative Republicans who oppose the expanded child tax credit. New York House Republicans were dissatisfied that the measure would not expand the $10,000 SALT cap.

Iowa Republican Senator Chuck Grassley said after the measure passed the House that he was concerned that the bill might make President Biden “look good” in an election year. Grassley said if Biden was reelected in November, Congress would be unable to extend the 2017 tax cuts that expire next year.

Senate Majority Leader Chuck Schumer told reporters last week that he supported the legislation and was working with Finance Committee Chairman Senator Ron Wyden on “the best way forward.”

The legislation would incrementally lift the refundable $1,600 cap on the child tax credit to adjust it for inflation. It also extends some expired business tax cuts from the 2017 tax cuts, including small business expensing and experimental and research expensing.

According to Senate Minority Leader Mitch McConnell’s office, the minority leader was deferring to Finance Committee ranking member Senator Mike Crapo to lead the Senate Republicans’ response to the measure.

Senator Crapo said the bill must first go through the Finance Committee to be revised and then undergo the “floor process where all the members can file their amendments.” Crapo said one change he would like to see is to eliminate the provision allowing taxpayers to use the previous tax year’s income if it gives them a larger child tax credit.