US Rep. Richard Neal: Expected conference committee changes make bad GOP tax bill worse
Washington, DC,
December 15, 2017
U.S. Rep. Richard Neal, D-Springfield, took issue Friday with a series of changes that are expected to be included in the compromise version of Republicans' tax overhaul plan. Neal, the top Democrat on the tax-writing House Ways and Means Committee and a member of the panel tasked with reconciling the House and Senate's tax bills, said while he believed the original proposals were bad, the latest expected changes could make the conference committee's even worse. Despite President Donald Trump and Republican leaders' pledge to focus tax relief on the middle class, the congressman argued, the bill likely to come out of conference could largely benefit the wealthiest Americans and offer only a temporary benefit to the average family. Neal pointed to the bill's expected reduction of the top tax rate to 37 percent as of example of how the legislation could disproportionately benefit rich Americans. "I thought it was a pretty bad bill to start with and they made it worse by cutting the top rate from 39.6 to 37 percent -- that's almost a 3 percent cut," he said during a morning appearance on MSNBC. "When you consider who's going to draw that benefit ... it's extraordinary to me that they would've actually been that bold in doing it." The conference committee's expected top rate would be lower than the Senate-passed tax plan's proposed 38.5 percent, and the House-passed bill's proposed 39.6 percent for individuals earning more than $500,000 and couples earning more than $1 million. The Democrat called the expected reduction "a huge miscalculation of public will" and a departure from the Trump administration's initial pledge. "What they indicated was there would be no tax relief for people at the top -- there's substantial tax relief for people at the top," he said in an interview. "I argued from day one that this should have been about middle class tax relief." Although Neal acknowledged that most Americans should see a tax cut under the GOP plan, he argued that the relief middle income earners would see is not expected to be permanent. Middle class taxpayers, the Democrat added, could further be hurt by the plan's expected changes to state and local tax, student loan interest and other deductions. Under the conference committee's expected bill, for example, Americans who itemize could claim up to just $10,000 for state and local tax deductions and take a property tax deduction in addition to deductions for income or sales taxes, up to a total of $10,000. Currently, taxpayers can deduct unlimited state and local income taxes, as well as sales and property taxes. The compromise version of the bill is also expected to cap the mortgage interest deductions on loans up to $750,000 -- down from the current $1 million cap. "They're giving it on one hand, and taking it away on the other," Neal said, adding that the limited middle class benefit should phase out in 2025 under the GOP plan. "I think it's a very meager benefit for the middle class here, if any." The congressman, however, noted that all of those provisions may have been subject to change, particularly as Republicans made last-minute, behind-the-scenes changes to the bill. "None of us really know what's in this bill or out of the bill at the moment," he said. "Over the weekend, the details will filter out." The conference committee is expected to release its report on the GOP tax overhaul plan at 5:30 p.m. on Friday. The updated version of the legislation will have to gain approval in both the House and Senate before it can be sent to Trump's desk and signed into law. |