A House Republican tax bill is expected to be released next week, marked up the following week and brought to the floor the week after that, Ohio GOP Rep. Jim Jordan said Monday night.
The former Freedom Caucus chairman said he and other members of the hard-line conservative caucus will support the Senate budget resolution that the House is expected to vote on Thursday, thanks to assurances that the tax bill will move under that accelerated timetable.
“It basically boils down to the nature of the United States Senate and what we know was likely to come out if there was a conference committee, which was probably going to be a bill closer to what the Senate had put together,” Jordan said.
The House Freedom Caucus did not take an official position on the budget during its weekly meeting Monday. Caucus Chairman Mark Meadows told reporters afterward there will be “yes” and “no” votes coming from the caucus but he expects the budget to pass. The North Carolina Republican said he has not received any urgent messages from the whip team, suggesting leadership has the necessary support for the budget vote.
Despite the anticipated quick release, Republicans have yet to make some key decisions, such as what to do with the state and local tax, or SALT, deduction.
New Jersey Rep. Tom MacArthur, who opposes repealing the deduction, said Ways and Means Chairman Kevin Brady told him Monday about the proposal he was currently considering but he declined to reveal what that is.
“In the end, he’s counting votes and that’s determining how much he moves,” MacArthur said.
The congressman said more than 21 members are standing united in opposition to repeal of the SALT deduction, which would be enough to sink a measure if no Democrats support the tax bill. Republicans currently hold 239 seats with vacancies stemming from the resignations of GOP Reps. Tim Murphy and Jason Chaffetz.
Meetings to discuss the SALT deduction are taking place Tuesday and later in the week, MacArthur said.
One idea that has been discussed is placing an income cap on who qualifies for the deduction. Proposals that focus on allowing property taxes to be deducted and excluding income taxes also remain on the table, MacArthur said. He said the Joint Committee on Taxation is scoring one of those proposals this week, but declined to say which.
“We have to have a compromise before a bill comes out,” he said. “You don’t want a bill to fail.”
President Donald Trump further complicated Republicans’ quest to find agreement on a package of tax rate cuts and code changes, breaking with his party by tweeting Monday that he wants the 401(k) system left unchanged.
The popular retirement program allows employees to save a slice of their paychecks before taxes are withdrawn; taxes are eventually paid, but not for years until the money is withdrawn, typically after that employee has reached retirement age.
The president essentially came out in opposition to a plan from congressional Republicans to lower the threshold for contributions to retirement plans that qualify for a deferred tax.
As Republican tax-writers toyed with ideas on altering the 401(k) in an attempt to make their still-emerging overhaul bill add up, the president, as he so often has, on Monday morning injected confusion and a new layer of difficulty into something his own party is doing.
The president posted on his favorite medium of communication, Twitter, that there “will be NO change to your 401(k).”
“This has always been a great and popular middle class tax break that works, and it stays!” he told his 41 million followers.
There will be NO change to your 401(k). This has always been a great and popular middle class tax break that works, and it stays!
The disagreement over the proposal is one of the first public policy discrepancies between the White House and GOP leaders in Congress on the pending tax overhaul.
Republican aides have long worried that Trump’s tendency to post erratically on social media could undermine the tax effort and drive a wedge into negotiations between Congress and the White House.
Monday’s tweet could be the first example of that and is likely to irk some members who were hoping to finalize negotiations in the next few weeks in order to meet an aggressive November timeline for the initiative.
The federal government currently allows individuals to contribute up to $18,000 to a 401(k) plan without paying taxes on it until that money is withdrawn from the retirement account.
Republicans, however, were considering lowering that threshold to as low as $2,400, according to congressional GOP aides. While such a move would have raised immediate revenue for the tax effort, budget experts have decried it as a charade since the money would have to be taxed at some point regardless.
That argument may be moot after Trump’s tweet, however. Sen. Lindsey Graham of South Carolina, a regular Trump golf partner, has warned if the party fails to pass tax cuts, it could be in trouble in the 2018 midterm elections.