rain
Thursday November 15th, 2018 1:56PM
8:41AM ( 5 hours ago ) Weather Alert

House Republicans seek permanent tax cuts as elections loom

By The Associated Press
Related Articles
  Contact Editor

WASHINGTON (AP) — House Republican leaders have unveiled their proposal to expand the massive tax law they hustled through Congress last year. They're aiming to make permanent the individual tax cuts and small-business income deductions now set to expire in 2026.

With midterm elections barely two months away, the second crack at tax cuts outlined Monday is portrayed as championing the middle class and small businesses. Republican Rep. Kevin Brady of Texas, who heads the tax-writing House Ways and Means Committee, is looking toward a vote on the legislation by the House this month. The solid Republican majority in the House nearly ensures passage before the November elections.

But prospects for the legislation in the Senate are weak, given the slim Republican majority and concern over the potential for further blowing up the deficit with a new tax cut — without corresponding new revenue sources. And even some House Republicans oppose a new tax bill.

The proposal also calls for new tax incentives for savings by creating a "universal savings account" for families that could be used for a range of purposes and would allow the tax-free earnings to be more easily withdrawn than is the case with existing retirement accounts. In addition, the Republican plan would allow the popular, tax-free 529 college savings accounts to also be used to pay for apprenticeship fees and home schooling expenses, as well as paying off student debt. Also, workers would be able to tap their retirement savings accounts without tax penalty to cover expenses from the birth of a child or an adoption.

Startup businesses would be permitted to write off more of their initial costs.

"This legislation is our commitment to the American worker to ensure our tax code remains the most competitive in the world," Brady said in a statement. Making the tax cuts permanent would build on the tax law's economic boost by adding 1.5 million new jobs and increasing wages, he said.

As the elections loom, polls are showing only lukewarm support among voters for the $1.5 trillion package of individual and corporate tax cuts that President Donald Trump signed into law in December as his signature legislative achievement.

Several Republican House members, facing tough re-election fights in high-tax, Democratic-leaning states like New York and New Jersey, voted against the tax legislation last year and would prefer to do without this new version as well.

The tax law that took effect Jan. 1, the most sweeping rewrite of the U.S. tax code in three decades, is estimated to add around $1.5 trillion to the ballooning deficit over 10 years. Deficit hawks as well as Democratic lawmakers — who were unanimous in opposing the tax legislation last year — are asking how the Republicans intend to pay for the extended tax cuts.

"After handing massive unpaid-for tax breaks to Big Pharma, Wall Street and the wealthiest 1 percent with the first GOP tax scam for the rich, House Republicans are here with more of the same," House Democratic leader Nancy Pelosi said Monday. "Republicans want to add even more to the deficit, and even more to the bank accounts of the wealthiest 1 percent."

The new tax law enacted in December provides steep tax cuts for corporations and the wealthiest Americans, and more modest reductions for middle- and low-income individuals and families.

While the law slashed the corporate tax rate permanently from 35 percent to 21 percent, its tax cuts for individuals and the millions of U.S. "pass-through" businesses expire in eight years. The "pass-through" businesses funnel their income to owners and other individuals, who then pay personal income tax on those earnings, not the corporate rate. They are allowed under the new law to deduct 20 percent of the first $315,000 of their earnings.

Also until 2026, the tax law ended the $4,050 personal exemption for individuals and capped at $10,000 the amount of property taxes or state or local taxes that consumers can deduct on their federal returns.

Early this year, millions of working Americans got a boost from the tax law as they saw increases in their paychecks with less tax withheld by employers. But as Trump's populist attacks against free trade have erupted into trade wars with China and U.S. allies, trade tensions have overshadowed the tax cuts in economically vulnerable areas of the country that depend on exports.

  • Associated Categories: Associated Press (AP), AP Online Headlines - Washington, AP Online Congress News, AP Elections, General House Election News, AP Business, AP Business - Corporate News, AP Business - Personal Finance, AP Business - Small Business
© Copyright 2018 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Stem cell transplant cements Arizona men's father-son bond
Both the Rev. John Ibraham Sabbagh and his 54-year-old son, Ebby Sabbagh, are celebrating one year of going strong since the elder Sabbagh received a crucial stem cell transplant
5:58PM ( 12 minutes ago )
Keselowski makes it a Penske sweep at Indianapolis
Brad Keselowski gave Roger Penske his first NASCAR win in the Brickyard 400 at Indianapolis Motor Speedway
5:47PM ( 23 minutes ago )
Bradley holds off Rose in playoff to win at Aronimink
Keegan Bradley holds off Justin Rose in sudden-death playoff to win rain-plagued BMW Championship for 1st PGA Tour victory in 6 years
5:35PM ( 35 minutes ago )
Associated Press (AP)
California aims to drop fossil fuels for electricity by 2045
California has set a goal of phasing out all fossil fuels from the state's electricity sector by 2045 under legislation signed by Gov. Jerry Brown
5:00PM ( 1 hour ago )
Wisconsin's Walker tries to alter conversation amid bad news
Embattled Wisconsin Gov. Scott Walker and his allies are trying to change the conversation of his re-election campaign, as bad news continues to pile up for the two-term Republican incumbent
4:51PM ( 1 hour ago )
White House says it's working to plan 2nd Trump-Kim meeting
White House press secretary Sarah Huckabee Sanders is categorizing North Korea leader Kim Jong Un's new letter to President Donald Trump as 'very warm' and 'very positive.'
4:40PM ( 1 hour ago )
AP Online Headlines - Washington
UK inquest begins into attack on bridge, Parliament
England's chief coroner has begun an inquest into the deaths of five people who died last year in an extremist attack on Parliament as "82 seconds of high and terrible drama."
11:44AM ( 6 hours ago )
High stakes as 2-month sprint to Election Day begins
Control of Congress and the future of Donald Trump's presidency are on the line as the 2018 primary season winds to a close this week
11:02AM ( 7 hours ago )
The Latest: Germany calls Swedish vote a 'turning point'
A senior German official is describing the Sweden's election, in which the governing party lost ground and a far-right party made gains, as a "turning point" for Sweden and Europe
7:29AM ( 10 hours ago )
AP Online Congress News
Nixon slams mailer questioning her support for Jewish people
Cynthia Nixon's campaign is crying foul over a Democratic Party mailer supporting Gov. Andrew Cuomo that questions her support for Jewish people
4:36PM ( 1 hour ago )
The Latest: Moderate leader calls on Swedish PM to resign
The leader of the party that was poised to place second in Sweden's general election says he has secured a mandate to form a new government and is calling on the sitting prime minister to resign
5:45PM ( 1 day ago )
The Latest: Swedish far-right leader says party 'won' vote
The leader of a far-right party that campaigned with an anti-migrant message says the party has "won" Sweden's national election
5:18PM ( 1 day ago )
AP Elections
Trump says of possible shutdown: 'If it happens, it happens'
Trump holds out possibility of a federal government shutdown this fall if Congress doesn't act to secure the nation's borders
7:03PM ( 4 days ago )
Democrat logs 35K miles in long-shot bid in Trump territory
A Democrat running for a House seat in one of America's biggest and most conservative districts feels optimistic as she logs 35,000 miles on her Jeep to meet with voters
4:33PM ( 5 days ago )
Pressley calls upset House win 'surreal,' gets in Trump dig
The black Boston city councilor whose upset primary win over a 10-term congressman stunned Massachusetts' political establishment calls her victory "surreal"
4:16PM ( 5 days ago )
General House Election News
CBS sets aside $120 million for Moonves, but will he see it?
CBS says it sets aside $120 million in a trust fund for a potential severance payment to ousted chief executive Leslie Moonves, but an outside investigation will determine whether the company chooses to give him the money
5:10PM ( 1 hour ago )
Tribes: Trump illegally approved oil pipeline from Canada
Native American tribes in Montana and South Dakota say the Trump administration unlawfully approved the Keystone XL oil pipeline without fully considering its potential damage to cultural sites
5:05PM ( 1 hour ago )
After Moonves, CBS takeover possible in new media landscape
The resignation of longtime CBS chief Les Moonves won't likely lead to drastic changes in network programs, but it could make the company ripe for a takeover as traditional media companies compete with upstarts such as Netflix and Amazon.
4:45PM ( 1 hour ago )
AP Business
The Latest: Walker wins Delaware GOP House primary race
Scott Walker, a business owner and landlord who ran unsuccessfully for Congress as a Democrat two years ago, has won the Republican primary for Delaware's lone U.S. House seat
9:25PM ( 3 days ago )
California police fight statewide marijuana deliveries
Police chiefs and cities are trying to block a proposed rule they say would allow unchecked home marijuana deliveries anywhere in California
8:06PM ( 1 week ago )
California police, cities fight statewide pot deliveries
California police chiefs are banding together with cities to block a proposed state rule that they say would allow unchecked home marijuana deliveries anywhere in California
6:08PM ( 1 week ago )
AP Business - Small Business
Keselowski makes it a Penske sweep at Indianapolis
Brad Keselowski gave Roger Penske his first NASCAR win in the Brickyard 400 at Indianapolis Motor Speedway
5:47PM ( 24 minutes ago )
Bradley holds off Rose in playoff to win at Aronimink
Keegan Bradley holds off Justin Rose in sudden-death playoff to win rain-plagued BMW Championship for 1st PGA Tour victory in 6 years
5:35PM ( 35 minutes ago )
The Latest: Keselowski hands Team Penske 1st Brickyard win
Latest on NASCAR racing at the Brickyard in Indianapolis
5:25PM ( 46 minutes ago )
Box Office Top 20: 'The Nun' conjures up $53.8 million
Box Office Top 20: The horror pic "The Nun" scared off the competition and dominated the North American box office, while "Peppermint" moves to second place
5:10PM ( 1 hour ago )
CBS sets aside $120 million for Moonves, but will he see it?
CBS says it sets aside $120 million in a trust fund for a potential severance payment to ousted chief executive Leslie Moonves, but an outside investigation will determine whether the company chooses to give him the money
5:10PM ( 1 hour ago )