Disputes among House Republicans on Tuesday threatened to derail the legislation, which Rep. Jason T. Smith (R-Mo.) and Sen. Ron Wyden (D-Ore.), the chairs of Congress’s tax-writing committees, spent seven months negotiating.
Politically vulnerable New York Republicans from districts Democrats are targeting this fall took a page from archconservative members of the House Freedom Caucus and threatened to sink a procedural vote on the House floor and stall business in the chamber.
The New Yorkers — Reps. Anthony D’Esposito, Nick LaLota, Michael Lawler and Andrew R. Garbarino — opposed the bill because it did not remove a $10,000 cap on the state and local tax deduction, which allows filers to deduct taxes paid to states and municipalities from their federal returns. The deduction, known as SALT, is popular in high-tax states, and the limit was also imposed in the 2017 Trump tax law.
From the other end of the debate politically, some Freedom Caucus members oppose the child tax credit provisions and liken them to a welfare expansion.
The protest on the House floor netted the groups a meeting with House Speaker Mike Johnson (R-La.), which ran late into Tuesday evening. The speaker and the New York group agreed that the House would work to find a way to vote on a bill to adjust the SALT deduction, and they dropped their protest, Republicans said. So Johnson pressed forward with his plan to put the bill up for a vote under a suspension of House rules, which requires a two-thirds majority to pass. The GOP dissent means Johnson will have to rely on Democratic votes to carry the measure, as he has been forced to do for every major piece of legislation since taking over the speakership in October.
Taylor Haulsee, a spokesperson for Johnson, said in a statement that the speaker and Smith “agreed that they would continue working with members to find a path forward for legislation related to SALT.”
The push by Johnson follows weeks of internal discussions among Republicans in both the House and Senate about whether to advance the legislation. While the business provisions are a priority across the caucus, and also mostly popular with Democrats, at least some Senate Republicans have groused that it made little sense to give Biden the opportunity to take credit for millions of American families getting bigger tax benefits during an election year, according to two people who spoke on the condition of anonymity to describe private talks.
On social media, conservative and right-wing accounts also circulated a false claim that the legislation would enable undocumented immigrants to claim the child tax credit. That is not true — the law does nothing to alter a provision requiring Social Security numbers to access the benefit — but the concerns reached far-right lawmakers in the Capitol, with House Freedom Caucus Chairman Bob Good (R-Va.) telling reporters that he would not support “child tax credits going to illegals.” House Ways and Means Chairman Smith responded to these criticisms, emphasizing in social media posts to his fellow Republicans that the legislation would do nothing to change the number of immigrants who claim the credit.
Heritage Action, a conservative advocacy group, urged lawmakers to oppose the legislation in an email on Monday, arguing it would give too much money to families who do not work. “The bill’s cash welfare benefits are socially harmful and provide a steppingstone to President Biden’s work-free ‘child allowance,’” the email said.
But momentum grew from outside groups and the business lobby to enact the changes. At a private meeting earlier this week of the Republican Study Committee, a group of House GOP conservatives, some advocacy organizations voiced their support for the measure. Talking to the crowd, Grover Norquist, president of the anti-tax group Americans for Tax Reform, compared tax cuts to sex, arguing that they were still worthwhile even when not as good as possible. Pro-life groups have also endorsed the measure.
“There’s no real good reason to vote against it,” Norquist said. “This is a powerful, pro-growth tax cut. … What’s not to like for Republicans?”
Also crucial was the decision of one particularly prominent Republican not to oppose the legislation, at least so far. Trump appears to have helped sink an emerging bipartisan Senate compromise on immigration and Ukraine, and if he had come out against the tax deal, too, many Republicans might have opposed it. An unsigned, eight-page PDF circulating among congressional GOP offices appeared to be written to persuade Trump supporters not to back the deal, according to a copy of the memo obtained by The Washington Post.
“Don’t undercut President Trump and his ability to provide bigger and better tax relief,” it says.
But Norquist and other supporters of the legislation argued to Trump’s advisers that the deal represents a victory for the former president, saying it amounts to Democrats joining Republicans to extend a key Trump policy initiative. As of Wednesday morning, the former president had not weighed in on the measure.
Marianna Sotomayor and Theodoric Meyer contributed to this report.
