Trump triumphs as Congress passes tax cuts
WASHINGTON – President Donald Trump hailed a historic victory Wednesday as the US Congress passed a massive Republican tax cut plan, handing him his first major legislative achievement since taking office nearly a year ago.
The House voted along party lines to greenlight a $1.5 trillion overhaul that will impact every corner of the US economy through dramatic tax cuts for corporations and temporary reductions for individuals.
“I promised the American people a big, beautiful tax cut for Christmas,” Trump said in a statement following the bill’s adoption. “With final passage of this legislation, that is exactly what they are getting.”
The most sweeping rewrite of the US tax code in decades, one that has taken months to get across the line, took a day longer after a technical glitch required the Senate to strip three minor provisions from the bill before approving it overnight.
Since the House had already voted – and the versions approved by both chambers must be identical – it was forced to vote again on the changes. The bill passed the House 224 to 201, with 12 Republicans siding with all Democrats in voting no.
Eyeing the most important legislative victory in the 11 months since his inauguration – after the stinging failure to repeal his predecessor’s health care law – Trump had demanded the bill reach his desk by Christmas.
As the vote got underway in the House, Trump gathered his cabinet members to deliver a celebratory address, that concluded with them bowing their heads as Housing Secretary Ben Carson offered a prayer for “unity”… so that people recognize that we have a nation that is worth saving.”
Trump had leaned heavily on Republicans to push the deeply contentious package through Congress. Republicans hope it plays to their advantage in next year’s mid-term elections.
But it appears unpopular: a CNN poll shows that 55 percent of Americans oppose the tax plan, widely criticized as favoring wealthy people over the middle class.
Republicans pushed back at that notion, with House Speaker Paul Ryan predicting that Americans would be won over once they start to reap the benefits next year.
“The average tax payer in every income group is getting a tax cut,” Ryan told ABC News. “I think minds are going to change and I think people are going to change their view on this.”
The Tax Cuts and Jobs Act is projected to add nearly $1.5 trillion to the national debt over the coming decade, according to the Joint Committee on Taxation.
That figure drops to about $1 trillion when economic growth is accounted for.
Ryan stated that a median-income family of four earning $73,000 annually would save $2,059 in taxes next year.
But he could not say whether the plan will generate enough economic growth to match costs of the deficit increase.
“Nobody knows the answer to that question because that’s in the future,” Ryan told NBC.
The Democratic opposition has denounced the measure as mostly benefiting companies and the wealthiest Americans – including Trump himself – and warns it risks blowing a hole in the national debt, which has surged past $20 trillion.
Top House Democrat Nancy Pelosi called the bill a “moral obscenity.”
Under the legislation, the federal corporate tax rate would fall from 35 percent to 21 percent, and the maximum individual income tax rate, for the nation’s wealthiest, would drop from 39.6 percent to 37 percent.
While Republicans failed earlier this year to repeal Obamacare, the tax plan takes a key step in that regard, by scrapping the individual mandate that requires nearly all Americans to have health insurance or pay a fine.
“With this bill… we have essentially repealed Obamacare and we will come up with something that’s much better,” Trump said.
Democrats warn that repealing the crucial provision will cause health care costs to rise, and that 13 million fewer people will have health insurance in the next decade.