WASHINGTON — Republicans in the U.S. House of Representatives passed its tax overhaul legislation Thursday, which would reorganize the personal income tax structure and decrease the corporate tax rate.
Reps. David McKinley, Alex Mooney and Evan Jenkins were among the 227 lawmakers who voted for the plan. Twelve Republicans from New Jersey, New York and California and one from North Carolina joined 192 Democrats in opposing the measure.
The House version of the Tax Cuts and Jobs Act would consolidate the seven current tax brackets to four with rates of 12 percent, 25 percent, 35 percent and 39.6 percent. The standard deductible for individuals and married couples would nearly double, and the child tax credit would increase from $1,000 to $1,600.
State and local tax deductions would be eliminated, as would deductions for medical expenses and student loan interests.
The corporate tax rate would decrease from the current rate of 35 percent to 20 percent. “Pass-through” businesses, such as those with a sole owner, would be taxed at a 25 percent rate.
Mooney said this bill would simplify the tax code and pass needed relief to West Virginia families.
“The current tax code is too confusing and in our tax reform plan most Americans will file their taxes on a postcard. This bill will grow our economy, encourage job creation and raise take-home pay,” he said in a release.
“While Democrats have failed to offer any tax relief plans, the Republican majority in Congress ran on a plan to reform the tax code—and today we delivered a big win for the American people.”
McKinley said it has been too long since lawmakers updated the tax code, referencing the bipartisan Tax Reform Act of 1986
“We have a clear choice here: do we allow the status quo to continue, which only benefits the wealthy and politically connected?” he said in a release. “Or do we allow the process to continue and fight to ensure the final version is the best deal possible for the middle class and small employers?”
Prior to Thursday’s vote, Jenkins spoke about his reasons for voting for the plan on MetroNews “Talkline.”
“Up and down, top and bottom, there are real, meaningful tax cuts, and also it’s a job creator. This is an important help to small businesses so we can grow jobs,” he said. “My mantra is: ‘a good job solves a lot of problems.’ Let’s bring some of the jobs that we’re running overseas back home and invest in America, invest in West Virginia.”
According to the U.S. Congressional Budget Office, the House bill would increase the federal deficit by $1.5 trillion over the next 10 years. Yet Jenkins said the changes to the tax structure would result in increased production.
“As the economy grows and you get into that 3, 3 1/2 percent GDP growth rate, that will far, far outpace and pay for that static scoring that the CBO suggested,” he said.
The CBO also reported Medicare could be cut $25 billion next year under the House proposal.
West Virginia Democratic Party Chairwoman Belinda Biafore called the bill “a tax scam” in a press release, adding McKinley, Mooney and Jenkins voted for a plan that would burden the middle class.
“The GOP has made it clear once again that their loyalty to corporations and big money outweigh any sort of loyalty they try to portray to West Virginia families,” she said.
Americans for Prosperity-West Virginia voiced their support of the House’s vote, adding Sen. Joe Manchin, D-W.Va., should support tax overhaul legislation.
“Special interests who want to keep the system rigged in their favor are busy using false scare tactics in a self-serving attempt to derail this once-in-a-generation opportunity. But history proves that tax reform will increase individuals’ disposable income, create jobs, grow wages, and enhance opportunity,” said Jason Huffman, the state director of the conservative organization.
Manchin has said he would oppose any plan that puts wealthy individuals over the needs of middle-class West Virginians.
The Senate tax plan, which includes a repeal of the individual mandate of former President Barack Obama’s health care law, faces a tougher challenge in getting passed. According to the Joint Committee on Taxation, Americans making up to $75,000 would pay more in taxes beginning in 2027 if the bill becomes law. While Republicans control the chamber, only two of the 52 senators with the majority party can vote against the plan for it to move forward. Wisconsin Sen. Ron Johnson said Wednesday he opposes the bill because it is favored toward corporations.
Sen. Shelley Moore Capito, R-W.Va., said Tuesday she is in favor of including the individual mandate repeal in the Senate tax bill.
The Senate Finance Committee voted Thursday evening to advance the tax overhaul bill. Senate Majority Leader Mitch McConnell, R-Ky., said he will bring the bill to the floor after lawmakers return from the Thanksgiving holiday.