House Passes $600 Billion in Tax Cuts in First Round of Budget Deal

By
Image
"I got it done. Are you happy now?"

Republicans took their reward for agreeing to keep the government open on Thursday, as the House of Representatives passed a tax bill that will extend more than 50 expiring tax cuts and make 20 of them permanent at a cost of more than $600 billion over the coming ten years.

The tax bill was the first part of the deal struck Tuesday night to avert a government shutdown for at least another year; both chambers are scheduled to vote Friday on the second leg: a $1.1 trillion spending package that Speaker Paul Ryan still isn’t too pleased to be passing.

Ryan, who was elected speaker six weeks ago, after John Boehner had enough of trying to whip the GOP’s renegade rump into voting to keep the lights on in their own offices, touted the tax bill as a conservative victory.

Finally with this tax bill, families and businesses are going to have the long-term certainty that they need instead of scrambling year after year to find out what’s next,” he said. Ryan’s Republicans voted nearly unanimously for the bill, but the vote divided Democrats 106–77.

The Democrats who voted against the bill argued that it was too solicitous of big business and also questioned its hefty price tag. Minority Leader Nancy Pelosi called it a “Trojan horse” and said it was “unconscionable” that the Republicans had done nothing to offset the cost of the tax cuts.

The bill scratched many Republican itches — including tax breaks for businesses’ research and development costs, delaying some of the tax components of the Affordable Care Act, and reducing the funds available for federal-discretionary spending in general — but also contained a few nontrivial sops to Democrats, such as permanent tax cuts for lower- and middle-income working families, and tax breaks for solar and wind energy.

We have been trying forever to get something good for the middle class and the working poor — and this is a jackpot,” Senate Minority Leader Harry Reid told the New York Times.

Senators Ted Cruz, Marco Rubio, and Rand Paul, all on the campaign trail, will miss Friday’s votes, in which the Senate is expected to pass both legs of the budget package. Cruz and Rubio have both made the deal a punching bag in their presidential campaigns, and had talked of trying to slow down the process. Which may explain why Senate Majority Leader Mitch McConnell opted to schedule the vote for a day when his Cuban-American colleagues would be out of town.