https://www.wsj.com/articles/sen-john-mccains-support-bolsters-gop-tax-hopes-as-senate-vote-nears-1512062349
A focal point for Republicans on Thursday will be an amendment to make child tax credits more generous.
The current Senate bill doubles an existing tax credit to $2,000 per child, which helps offset the loss of other tax breaks. Sens. Marco Rubio (R., Fla.) and Mike Lee (R., Utah) are proposing expanding the child tax credit to more low-income families. They want to pay for the measure with a 22% corporate tax rate, higher than the 20% rate pushed by President Donald Trump.
Messrs. Rubio and Lee say the party needs to focus more on families and mitigate the cost of raising children. The pro-business wing of the party says the 20% corporate tax rate is crucial to the bill. Groups such as Americans for Tax Reform, led by antitax activist Grover Norquist, were rallying conservatives against the amendment.
“I don’t think it would pass,” said Sen. Richard Burr (R., N.C.), saying he saw no reason to move from a 20% corporate-tax rate.
“I don’t have a problem necessarily with 20%, but 22% would generate just as much growth,” Mr. Rubio said.
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Ms. Collins said she planned to offer a slightly different amendment that would pay for expanding the tax credit for child and dependent care by changing the tax treatment for carried interest. Carried interest is the profit that some investment managers, such as at hedge funds, typically get. It is taxed at preferential long-term capital-gains rates, now 23.8%, compared with the current top ordinary income rate of 39.6%.
I don’t have children, but more support for raising children is a good thing. Personally I would prefer they kept the exemptions, but on the whole this credit makes sense.
Also - raising the corp tax rate by a couple points would also close the gap some critics have complained about: that pass through entities pay more than corporations. Even if corps were slightly more, it would make sense for corps to pay a few points more tax in exchange for the benefits, such as liability shield.
Ms. Collins, a Republican who is a crucial swing senator, indicated Thursday morning that her support for the bill would depend on passage of an amendment she has offered to include a deduction for property taxes up to $10,000, as well as an agreement she struck with GOP leaders to separately pass two health-care bills designed to stabilize the individual insurance market.
Those bills are aimed at offsetting the impact of repealing the individual mandate in the Affordable Care Act, which says that most people must have health-care insurance or pay a penalty. Republicans added the mandate repeal to the tax bill because it reduces federal health-care spending and thus frees up money for deeper tax cuts.
Mandate repeal - why not. Sorry for these of you on the individual market that actually pays for coverage yourself. However, making the situation so shitty and sticky may incent later action.