GOP in furious push for tax-reform votes

The White House and GOP leaders are scrambling to win over Republican senators who are concerned that the tax legislation could blow up the deficit or would not provide enough help to small businesses.

Much of the focus on Monday was centered on Sen. Steve Daines (R-Mont.), who is pressing for changes to the bill that would help “pass-through” businesses.

{mosads}A larger group of undecided Republicans appears to be seeking changes that would aim to limit the bill’s impact on the national debt.

Senate Republican leaders are planning to vote Wednesday on a motion to proceed to the tax bill, but a handful of Republicans have not taken a hard stance yet. Republican leadership can only afford to lose two votes, assuming all members of the Democratic caucus vote against it.

Senate Majority Whip John Cornyn (R-Texas) told reporters Monday that he expects leadership to offer a series of amendments to the bill on the floor.

“This is a dynamic process,” he said.

While Republicans across the board say they want to vote for the tax bill, some are pushing for changes before committing their support.

Daines on Monday became the second GOP senator to oppose the current version of the legislation, joining Sen. Ron Johnson (R-Wis.) in protesting that the bill treats corporations better than pass-through businesses.

Pass-throughs are companies such as sole proprietorships and partnerships that are taxed through the individual code. Most U.S. businesses, including many small businesses, are pass-through entities.

The Senate tax bill would create a 17.4 percent deduction for pass-through income, but pass-throughs would see less of a tax cut than corporations, which would get their rate slashed from 35 percent to 20 percent.

“I want to see changes to the tax cut bill that ensure main street businesses are not put at a competitive disadvantage against large corporations,” Daines said in a statement. “Two-thirds of our job creation comes from main street businesses and I’m doing what I can to make sure all of America is stronger and more competitive. Before I can support this bill, this improvement needs to be made.”

Johnson told Wisconsin reporters Monday that he would vote against the bill in the Senate Budget Committee on Tuesday afternoon if a change to the pass-through provision hasn’t been made by then.

“I’m not exactly sure what’s going to happen in committee; we’re working diligently to fix the problem,” he said. “If we develop a fix prior to committee, I’ll probably support it but if we don’t, I’ll vote against it.”

A no vote from Johnson could be a big setback for Republicans because they only have a one-seat majority on the Budget Committee.

Senate GOP leaders and administration officials have been trying to address the concerns of Daines and Johnson, possibly by increasing the pass-through deduction to 20 percent.

President Trump tweeted that with a few changes to the tax bill, “the pass through provision becomes simpler and really works well!”

A handful of other GOP senators have not taken a hard stance on the tax bill yet because they are worried about the measure’s impact on the debt.

“I would very much like to support it. We have got to get some things all worked out, and those are all in process,” Sen. James Lankford (R-Okla.) said during a news conference Monday.

The Joint Committee on Taxation estimated that the bill in its current form would add about $1.4 trillion to the deficit in its first 10 years. Republicans have said that they expect increased economic growth produced by the tax cuts to generate additional revenue that would offset some or all of the deficit increases.

But Lankford said he would like to see a “backstop” if the economic growth targets aren’t hit. He said he’s looking at a number of options for what such a provision would look like.

“I believe that we should not only take the best guesses that we can get out there from the best economists and be able to look at it, but we should build in the what if,” he said. “What if this doesn’t work? What changes might be needed in the tax code in the days ahead to be able to adjust in what scenario? So if the revenue is not coming in, should the rates change?”

Lankford said he’s had “good conversations” with other lawmakers about the tax bill.

“The conversations have all been extremely productive,” he said.

Besides Lankford, several other GOP lawmakers have raised concerns about the impact of the tax bill on the debt, including Sens. Jerry Moran (Kan.), Bob Corker (Tenn.) and Jeff Flake (Ariz.).

Corker and Flake both decided against seeking reelection in 2018 and have been outspoken critics of Trump. Still, they both backed the Senate’s efforts to repeal ObamaCare and maintained that their votes on tax legislation would be unrelated to any personal issues they have with the president.

Concerns about the deficit may have a bigger influence on the ultimate Senate bill than they did in the House, where only one GOP lawmaker, Rep. Walter Jones (N.C.), voted against legislation because of debt concerns.

On the other hand, Sen. Rand Paul (R-Ky.) on Monday came out in support of the Senate GOP tax bill, in part because the bill is not revenue neutral.

“I spoke out all year against the GOP leaders’ initial plan to make their tax reform ‘revenue neutral’ — meaning not really a cut,” he said in a Fox News op-ed. “I’m pleased to see my point of view has prevailed, and the current tax plan calls for a $1.5 trillion cut over the next ten years.”

In addition to the deficit hawks, Sens. Susan Collins (Maine) and Lisa Murkowski (Alaska) have also not yet announced their positions on the bill.

Collins has expressed concerns about a provision that would repeal the individual insurance mandate in ObamaCare. Murkowski supports repealing the mandate but hasn’t yet endorsed the full bill.

The Senate Budget Committee is scheduled to meet Tuesday to consider the tax bill and legislation allowing oil and gas drilling in the Arctic National Wildlife Refuge (ANWR) and combine them into one bill. ANWR drilling is a top priority for Murkowski.

Trump is planning to rally GOP senators on taxes on Tuesday, when he attends the Senate Republicans’ lunch. He is also planning to sell the tax bill on Wednesday during a speech in Missouri.

—Jordain Carney contributed.