By KEVIN FREKING and MARCY GORDON
WASHINGTON (AP) – President Donald Trump on Monday barged into congressional Republicans’ carefully calibrated work on revamping the nation’s tax code, calling for a steeper tax cut for wealthy Americans and pressing to add a contentious health care change to the mix.
In a tweet, Trump commended GOP leaders for getting the tax overhaul legislation closer to passage in recent weeks and said, “Cut top rate to 35% w/all of the rest going to middle income cuts?”
That puts him at odds with the House legislation that leaves the top rate at 39.6 percent and the Senate bill as written, with the top rate at 38.5 percent.
Trump also said, “Now how about ending the unfair & highly unpopular individual mandate in (Obama)care and reducing taxes even further?”
With few votes to spare, Republicans leaders hope to finalize a tax overhaul by Christmas and send the legislation to Trump for his signature. House leaders have compromised with some rank-and-file Republicans in hopes of passing their version of the bill this week. The Senate Finance Committee starts work on its legislation on Monday afternoon.
Trump’s tweet injects a degree of uncertainty in the process as the GOP tries to deliver on the president’s top legislative priority and hold onto their majorities in next year’s midterm elections.
Neither bill includes a repeal of the so-called individual mandate of Barack Obama’s Affordable Care Act, the requirement that Americans get health insurance or face a penalty. Several top Republicans have warned that including the provision would draw opposition and make passage tougher.
Underscoring the difficulty, the chairman of the House’s tax-writing committee said Sunday he was certain that chamber won’t go along with the Senate’s proposal to eliminate the deduction for property taxes, setting up a major flashpoint.
Among the biggest differences in the two bills that have emerged: the House bill allows homeowners to deduct up to $10,000 in property taxes while the Senate proposal unveiled by GOP leaders last week eliminates the entire deduction.
The deduction is particularly important to residents in states with high property values or tax rates, such as New Jersey, Illinois, California and New York. Rep. Kevin Brady, chairman of the House Ways and Means Committee, said that he worked with lawmakers in those states to ensure the House bill “delivers this relief” and that he was committed to ensuring it stays in the final package.
“It’s important to make sure that people keep more of what they earn, even in these high-tax states,” Brady, R-Texas, said during an appearance on “Fox News Sunday.”
The Senate’s tax-writing committee will wade through its newly unveiled measure starting Monday. The legislation in the House and Senate carries high political stakes for President Donald Trump and Republican leaders in Congress, who view passage of tax cuts as critical to the GOP’s success at the polls next year.
The House is expected to vote on its measure on Thursday. The House Ways and Means Committee approved it last week on a party-line 24-16 vote.
Democrats are solidly opposed to the GOP revamp, so the Republicans must find agreement among themselves to have any hope of passage.
Both the House and Senate versions of the legislation would eliminate deductions for state and local income taxes and sales taxes paid. Sen. Chuck Schumer, D-N.Y., said in response to Brady’s pledge that Republicans should fully restore what is referred to as the SALT deduction, or millions of middle-class families would end up paying higher federal income taxes, not less.
“The House’s so-called ‘compromise’ would be saying to the middle class we’ll only chop off four of your fingers instead of all five,” Schumer said in a statement.
A key feature of both bills is a reduction in the corporate tax rate from 35 percent to 20 percent. But the Senate version delays the cut for one year. Treasury Secretary Steven Mnuchin said on CBS’s “Face The Nation” that he was confident the issue would not be a stumbling block to reaching an agreement.
“Obviously we would prefer if they kicked in sooner rather than later, but we’re going to work with the Senate on that issue,” Mnuchin said.
Mnuchin also rebuffed projections that the proposed tax cuts would increase the national debt. He said that creating sustained economic growth of 3 percent or higher would generate trillions of dollars in additional revenue to the government. He did not specify over what time frame that would occur.
“This is all about growth,” Mnuchin said.
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