GOP Applying The Brakes On The Tax Bill

WASHINGTON - The rush to finish the GOP tax overhaul has snagged slightly as Republicans grapple with substantial differences between the House and Senate bills, and pause to consider unintended consequences of the most extensive rewrite of the tax code in a generation.

Lawmakers are eager to pass the bill, President Donald Trump's top domestic priority, by Christmas, but they are also increasingly wary of political fallout from the hurried process and want to prevent embarrassing moments, like the scribbled text hastily added to the margin of the final Senate bill.

The end of any major legislative undertaking is often a sprint to the finish. But the final stretch of the GOP tax plan is being complicated by an accelerated process like none other in recent history.

"Republicans have made a decision, which I can't fault them for, that the longer this bill hangs out there, the more barnacles attach," said Jonathan Traub, the former Republican staff director at the House Ways and Means Committee and now managing principal at Deloitte's tax policy group. "We've seen time and time again, big issues left out in the sun too long start to attract vultures. They need to move quickly to take advantage of the enthusiasm."

Lawmakers are set to convene Wednesday for the first - and perhaps only - open meeting of a conference committee tasked with reconciling the House and Senate versions of the tax bills.

The Republican staffs met privately over the weekend, and leaders fielded calls with Trump and Treasury Secretary Steven Mnuchin, as they cobble together a final version without Democratic input. As the majority in Congress, Republicans are relying on special budget rules to pass the bill on their own to bypass the threat of a Democratic filibuster.

Yet even with control of the House, Senate and the White House, Republicans have struggled to resolve differences over individual income brackets, allowable deductions and when corporate rate cuts will take effect. A hoped for deal over the weekend did not materialize as talks continued.

The legislation is already bumping against the $1.5 trillion cap Republicans are allowing in deficit spending, but many changes lawmakers want to make - like reinstating a planned repeal of the medical expenses deduction or shelving an idea to tax graduate student tuition stipends - have left them scrambling to make tweaks elsewhere to pay for them. Both Senate Majority Leader Mitch McConnell, R-Ky., and House Speaker Paul Ryan, R-Wis., have said that the tax cuts wouldn't add to budget deficits.

One possible change now being debated is whether to nudge the corporate tax rate, now proposed to drop from 35 percent to 20 percent in both bills, up to 21 percent or 22 percent. There continues to be deep resistance from GOP business allies, even though Trump has said he would be open to it. Such a shift would generate some $200 billion to pay for other provisions of the plan.

The president is set to address the nation Wednesday about the proposal.

Normally at this stage of the legislative process, lawmakers and staff would be pouring over the text, trying to catch typos and thinking through the bill's logic to prevent any unforeseen consequences.

But under the GOP's fast-track process, the bill is still being written the week before a likely vote.

Credit: By Lisa Mascaro - Washington Bureau