Republicans Set Stage For Crucial Tax Overhaul Votes

WASHINGTON (AP) — Republicans began pushing a broad tax cut for businesses and many individuals through the Senate Finance Committee on Wednesday, a measure complicated by a late addition — repeal of the Obama health care law's requirement that Americans get insurance coverage.

In the House, a separate version without the repeal element cleared a procedural hurdle, setting the stage for a crucial Thursday vote.

Erasing the Affordable Care Act's individual mandate provided Republicans with more money that they used to make some tax breaks for people modestly more generous. But it raised questions about whether it might prompt some moderate GOP senators to back away from the measure.

The nonpartisan Congressional Budget Office has projected that dismantling the requirement would mean 4 million additional uninsured people by 2019 and 13 million more uninsured by 2027. Worries about leaving more people without coverage were among the reasons GOP attempts to outright repeal much of President Barack Obama's law crashed in the Senate this summer.

Republicans controlling the Senate 52-48 can afford to lose only two votes and still push the measure through the chamber, since all Democrats seem likely to oppose the package.

In another money-saving move, Hatch changed his bill late Tuesday to abruptly end the personal tax reductions after 2025. Under Senate rules, if legislation bill drives up federal budget deficits after 10 years it cannot be shielded from bill-killing filibusters by Democrats. It takes 60 votes to end a filibuster, numbers Republicans don't have.

The corporate tax cuts would be permanent. They include dropping the corporate tax rate from 35 percent to 20 percent.

"Keeping the individual mandate tax in place means retaining the status quo, which isn't working all too well," said Senate Finance panel chairman Orrin Hatch, R-Utah. "Zeroing it out means we have a chance to provide greater tax relief to middle-class families, through both reduced penalties and lower overall rates."

The Finance committee was hoping to approve the measure by week's end. A separate version of the bill cleared a procedural hurdle in the House on Wednesday on a 235-191 party-line vote. The House is expected to pass its legislation on Thursday.

White House legislative director Marc Short said President Donald Trump spoke Wednesday to Senate Majority Leader Mitch McConnell, R-Ky., and House Speaker Paul Ryan, R-Wis., about the tax legislation. Trump plans to talk to House Republicans about their measure at the Capitol on Thursday to rally support before the House vote.

Short said Republicans feel they have momentum but added, "We're always concerned. The reality is we don't have a large margin in the Senate."

Eliminating the mandate provides Republicans with $318 billion in 10-year savings, due to fewer people who'd be expected to get government-subsidized health coverage. It imposes a tax penalty on people who don't have insurance at work and don't buy an individual policy.

Democrats pounced on the GOP changes.

"My colleagues on the other side have now shown their hand. The corporate handouts are permanent, the family breaks are not," said Oregon Sen. Ron Wyden, top Democrat on the Finance Committee. "To pay for these handouts to multinational corporations, millions of Americans are going to lose their health care, millions will see their premiums skyrocket, and millions will get hit with a tax hike."

Hatch's revised version of the tax bill would double the child tax credit to $2,000 from the current $1,000. The credit would rise to $1,600 under the House bill.

Also, Hatch's revision makes slight reductions in individual tax rates for three moderate income brackets, numbers three, four and five of a total seven. The rates are now 10, 12, 22, 24, 32, 35 and 38.5 percent. The House bill shrinks the current seven brackets to four: 12, 25, 35 and 39.6 percent.

The surprise renewal of the effort to eliminate the health care law's mandate came a day after President Donald Trump renewed pressure on Republican lawmakers to include the repeal in their sweeping legislation to revamp the tax system. It carries high political stakes for Trump, who lacks a major legislative achievement after nearly 10 months in office.

Promoted as needed relief for the middle class, the House and Senate tax overhaul bills would deeply cut corporate rates, double the standard deduction used by most Americans and limit or repeal completely the federal deduction for state and local property, income and sales taxes. Republican leaders deem passage of the first major tax overhaul in 30 years as imperative for the GOP to preserve its majorities in next year's elections.

Beyond Trump's prodding, the repeal move was dictated by the Republicans' need to find revenue sources for the massive tax-cut bill, which calls for steep reductions in the corporate tax rate and the elimination of some popular tax breaks.

To win over moderate Senate Republicans to the tax legislation, the Senate may take up at the same time a bipartisan compromise to shore up health care subsidies, Sen. John Thune, R-S.D., indicated Tuesday. Thune is a member of the Finance panel.

Associated Press writers Kevin Freking, Andrew Taylor, Ricardo Alonso-Zaldivar, Catherine Lucey and Alan Fram contributed to this report.