House passes tax bill, Senate Finance finishes markup
The House on Nov. 16 passed the tax bill while the Senate Finance Committee finished a markup of its bill, paving the way for it to go to the Senate floor after the Thanksgiving break.
The House bill passed by a vote of 227-205, with 13 Republicans joining all Democrats in voting against it.
House Agriculture Committee Chairman Michael Conaway, R-Texas, did not comment on the bill, but House Agriculture ranking member Collin Peterson, D-Minn., said “I support making the corporate tax rate more competitive internationally and simplifying our system.”
“However, eliminating a number of provisions like those that help families who have large medical bills due to cancer or Alzheimer’s, or those that help people struggling to pay off their student loans in order to pay for the corporate reduction is not fair and not needed given we end up with a large increase in the national debt anyway,” Peterson said.
“While this bill claims to make taxes simpler for many individuals by increasing the standard deduction, the elimination of personal exemptions makes the increase very small,” he said.
“It will also create a more complicated system for pass through entities that I believe will be abused and spawn tax shelter businesses. We can lower the corporate tax rate, but shouldn’t do it at the expense of individual deductions, or the elimination of Sec. 199 for co-ops, or the wind power credit.
“A significant number of individual taxpayers will see major increases in their tax bill while adding at least $1.5 trillion to the deficit,” Peterson said. “Corporate rates can be reduced without sticking future generations with this added debt. I cannot in good conscience support a bill that drives up our deficit and will increase taxes on thousands of Minnesotans.”
National Cattlemen’s Beef Association President Craig Uden, a Nebraska cattle producer who campaigned for provisions that will double the exemption for the estate tax immediately and end it in five years, said the bill is “a step in the right direction” but still creates “undue and unfair burdens for certain segments of our industry.”
Uden praised the preservation of the step-up in basis upon inheritance and provisions to fully expense the cost of new investments, increase Section 179 small-business expensing limits and expand cash accounting.
But Uden noted the bill “would also significantly limit the ability of some businesses from deducting their interest expenses. This could be a big problem for some members of the cattle-production business.”
The National Farmers Union said the bill would increase the federal debt and jeopardize farm program funding.
An opponent of regressive taxation, increased federal debt, and legislation that jeopardizes farm program funding, NFU urged House members to vote against the legislation and scored the vote.
“NFU is alarmed by the House’s decision to pass highly flawed tax reform legislation that has disastrous implications for American family farmers and ranchers,” said NFU Vice President of Public Policy and Communications Rob Larew.
“The policies put forth by this bill would increase the tax burden on family farmers and the middle class, and they add a massive $1.5 trillion to our national deficit. On top of that, they potentially put funding for vital farm safety net programs on the chopping block and jeopardize passage of the farm bill.”
Senate Finance action
Later in the day, the Senate Finance Committee approved its bill at the end of a four-day markup.
“By nearly doubling the standard deduction, lowering tax rates, and doubling the child tax credit, we have made good on our promise to deliver a bill that will improve the lives of average Americans who have been hit by nearly a decade of sluggish economic growth,” said Senate Finance Committee Chairman Orrin Hatch, R-Utah.
“Bringing our outdated tax structure into the 21st century will help level the playing field for businesses — both small and large — and ensure we can keep more jobs and more investment here at home.”
Senate Agriculture Committee Chairman Pat Roberts, R-Kan., voted for the bill and praised the provisions that he said would provide tax relief for middle class families.
“I am also proud of the pro-growth provisions I secured in the bill for farmers and ranchers, especially during this tough economy,” Roberts added, but he did not provide details.
But Sen. Tom Carper, D-Del., said “This evening, Republicans on the Senate Finance Committee approved a bill to repeal a critical part of the Affordable Care Act, and blow a hole of at least $1.5 trillion in our federal deficit over the next 10 years in order to give millions of dollars in tax breaks to the wealthiest Americans. It’s shocking. In fact, it’s almost unbelievable.”
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The House Agriculture Committee on Thursday passed five bills including the Cattle Contract Library Act of 2021.