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Financial Planning > Tax Planning

Senate Passes Tax Cut Bill; House Set for Revote

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The Senate passed early Wednesday morning by a 51-48 vote the GOP’s Tax Cuts and Jobs Act, with the House set to revote Wednesday afternoon to rectify what the Senate said were three provisions in the bill that didn’t comply with Senate budget rules, or the so-called Byrd rule.

The Senate Budget Committee said late Tuesday that they wanted the following provisions to be addressed in the House revote: One of the provisions allows for the use of 529 savings accounts for home-schooling expenses; the short title: “The Tax Cuts and Jobs Act;” and part of the criteria used to determine whether the endowments of private universities are subject to the legislation’s new excise tax.

Sens. Bernie Sanders, I-Vt., ranking member of the Budget Committee, and Ron Wyden, D-Ore., ranking member of the Finance Committee, issued a joint statement late Tuesday that “in the mad dash to provide tax breaks for their billionaire campaign contributors, our Republican colleagues forgot to comply with the rules of the Senate. We applaud the parliamentarian for determining that three provisions in this disastrous bill are in violation of the Byrd rule.”

Sanders and Wyden noted their “intention to raise a point of order to remove these provisions from the conference report and require the House to vote on this bill again. Instead of providing tax breaks to the wealthiest people and most profitable corporations, we need to rebuild the disappearing middle class.”

The House of Representatives passed the tax bill, H.R. 1, by a 227-203 vote Tuesday, and is expected to revote this afternoon and send the legislation to President Donald Trump for his signature.

Echoing House Democrats’ criticisms of the bill on the House floor before the Tuesday vote, Wyden said late Tuesday on the Senate floor that the “Republicans today officially turned their backs on America’s middle class.”

With the tax cut bill, Republicans, Wyden said, are “doling out new giveaways to multinational corporations” and “taking away the Medicare and Social Security guarantees for the future.”

Passing the $1.5 trillion bill “guarantees years and years of instability in our tax code,” Wyden charged. “The bill is full of mistakes that [are] going to have drastic unintended consequences.”

Senate Finance Committee Chairman Orrin Hatch, R-Utah, stated, however, that “passage of this important bill will be historic — the culmination of years of work by people in both parties, in both chambers, and on both sides of Pennsylvania Avenue. Many of us in this body have been waiting years for this opportunity. And millions of Americans outside of this body have been waiting even longer.”

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