In what would be the largest change to U.S. tax laws since the 1980s, Republicans want to add $1.4 trillion over 10 years to the $20 trillion national debt to finance changes that they say would further boost an already growing economy.
Trump, speaking to reporters as he left the White House for New York hours after the pre-dawn vote, praised the Senate for passing “tremendous tax reform” and said “people are going to be very, very happy”.
Once the Senate and House of Representatives reconcile their respective versions of the legislation, he said, the resulting bill could cut the corporate tax rate from 35percent “to 20 (percent). It could be 22 (percent) when it comes out. It could also be 20 (percent).”
The Senate approved their bill in a 51-49 vote, with Democrats complaining that last-minute amendments to win over skeptical Republicans were poorly drafted and vulnerable to being gamed later.
Senator Bob Corker, one of few remaining Republican fiscal hawks who pledged early on to oppose any bill that expanded the federal deficit, was the lone Republican dissenter.
Talks will begin, likely next week, between the Senate and the House, which already has approved its own version of the legislation, to reconcile their respective bills.
KEY CHANGES
Numerous last-minute changes were made to the bill on Friday and in the early morning hours of Saturday.
One was to make state and local property tax deductible up to $10,000, mirroring the House bill. The Senate previously had proposed entirely ending state and local tax deductibility.
In another change, the alternative minimum tax (AMT), both for individuals and corporations, would not be repealed in full. Instead, the individual AMT would be adjusted and the corporate AMT would be maintained as is, lobbyists said.
Under the bill, the corporate tax rate would be permanently slashed to 20 percent from 35 percent, while future foreign profits of U.S.-based firms would be largely exempt, both changes pursued by corporate lobbyists for years.
The Senate bill would gut a section of Obamacare by repealing a fee paid by some Americans who do not buy health insurance, a step critics said would undermine the Obamacare system and raise insurance premiums for the sick and the old.
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