Corker Says He Faced ‘Tough’ Decision in Supporting Republican Tax Bill
December 19, 2017 by admin
Filed under Latest Lingerie News
His decision highlights the trade-offs that Republicans, who have long pushed for fiscal responsibility, are making as they seek to score their first legislative victory since assuming political control. The $1.5 trillion tax bill, which cuts taxes for businesses and individuals, is expected to add $1 trillion to the deficit over the next 10 years, according to the congressional Joint Committee on Taxation. Rather than pay for those cuts, lawmakers are relying on rosy assumptions about economic growth and suggesting they will cut spending on programs like Medicare and Social Security to help bring down the deficit.
Mr. Corker has been the most vocal about the need to rein in the federal deficit. He voted against the initial Senate bill, the only Republican to do so, after party leaders rejected his request to require automatic tax increases down the road if the overhaul did not generate enough revenue to pay for itself.
As recently as last Wednesday, Mr. Corker said the final changes being made to the combined Senate and House bill had done little to assuage his concerns that his party was being fiscally reckless.
“My deficit concerns have not been alleviated,” said Mr. Corker, who lamented that the bill could have been improved with more time.
On Friday, Mr. Corker stunned many in Washington when he said he would back the tax bill, which, while imperfect, would still be good for the country.
Opponents of the tax plan immediately searched for a motive in the hope that they could alter his vote in the narrowly-held Senate. With just a 52-to-48 majority in the Senate, Republicans have little room for defections given that Senator John McCain, Republican of Arizona, is receiving medical treatment in his home state and is not expected to return to Washington in time for the vote. On Monday, two additional Republican senators, Mike Lee of Utah and Susan Collins of Maine, said they would vote yes.
As new details in the tax bill came to light over the weekend, an article published by the International Business Times suggested that Mr. Corker’s vote was won in exchange for a last-minute provision that would benefit real estate developers by making it easier for them to take advantage of a new, more generous tax structure for so-called pass-through businesses, whose owners pay taxes on profits through the individual code.
Advertisement
Continue reading the main story
Mr. Corker, who was active in the real estate business in Tennessee before becoming a senator, retains a financial stake in companies that could benefit from the change.
Critics of the Republican tax overhaul adopted a new rallying cry to criticize a bill that they say is packed with advantages for the rich: “The Corker Kickback.”
Mr. Corker, in the interview, called the accusations ”disheartening” and said that he had not changed anything in the final bill.
What’s in the Final Republican Tax Bill
The legislation would cut taxes for corporations. American taxpayers, in large part, would also get cuts, though most of the changes affecting them would expire after 2025.
“There’s nothing to buy me off with,” Mr. Corker said.
On Sunday, Mr. Corker sent a letter to Senator Orrin G. Hatch of Utah, the Republican chairman of the Finance Committee, asking that he explain how the provision became included in the bill.
“Because this issue has raised concerns, I would ask that you provide an explanation of the evolution of this provision and how it made it into the final conference report,” Mr. Corker wrote. “I think that because of many sensitivities, clarity on this issue is very important and hope that you will respond in an expeditious manner.”
Newsletter Sign Up
Continue reading the main story
Thank you for subscribing.
An error has occurred. Please try again later.
You are already subscribed to this email.
Mr. Hatch, in a letter issued on Monday morning, defended Mr. Corker and said he was “disgusted” by reports that suggested Mr. Corker had played a role in the provision’s addition. He said Mr. Corker had wanted a less generous pass-through exemption than had been included.
“I am unaware of any attempt by you or your staff to contact anyone on the conference committee regarding this provision or any related policy matter,” Mr. Hatch wrote. “To the contrary, virtually all the concerns you had raised in the past about the treatment of pass-through businesses in tax reform were to voice skepticism about the generosity of various proposals under consideration.”
In fact, the Senate bill that Mr. Corker voted against already contained big benefits for the real estate industry. In large part, that is because of a provision cutting taxes for the owners of pass-through entities. Such businesses, like partnerships and limited liability companies, do not pay taxes themselves, but instead pass through their tax liabilities to their owners. Currently, such income is taxed at rates as high as 39.6 percent. But under the Senate bill, much of that income could be taxed at a rate as low as 29.6 percent. The bill limited those tax savings, partly by pegging the lower taxes to the size of a company’s workforce.
The final bill released on Friday included a new provision permitting the real estate industry to take advantage of the lower tax rate, tying the savings to the value of their properties — regardless of their size or their number of employees. Mr. Hatch said he had inserted the provision after discussions with the House and Senate negotiators writing the final bill and a congressional leadership aide pointed out that a version of it was in the House bill.
Advertisement
Continue reading the main story
Democrats remain unconvinced, and they have taken to social media to voice their concerns.
“There really isn’t any other good explanation is there?” Representative Ted Lieu, a Democrat from California, wrote on Twitter, suggesting that the provision was the reason that Mr. Corker decided to back the bill.
Others, however, suggested that Mr. Corker’s change of heart was more political than financial and that he did not want to be the lone Senate Republican to vote against his party’s tax bill.
“The conspiratorial speculation about Corker’s real estate pass-through holdings seems thin to me,” said Scott Greenberg, a tax analyst at the conservative Tax Foundation. “Perhaps a simpler explanation for Corker’s flip is that his vote wasn’t needed before but is needed now.”
In Tennessee, Mr. Corker’s intended vote was welcomed on Monday.
“We’re very happy with his final position,” said Bradley Jackson, the president of Tennessee’s Chamber of Commerce, who had discussions with Mr. Corker and his office in recent weeks.
Mr. Corker said his turnaround came after he engaged in deep discussions with business groups in Tennessee and around the country, the Republican leadership in Congress, his Senate colleagues and his wife. He also spent many private moments considering how to vote, meditating over the question on the balcony of the Senate chamber.
While Mr. Corker said it was “not something that’s pleasant” to be the only Senate Republican to oppose the tax bill, his colleagues were generally respectful of his decision and only prodded him gently.
In the end, Mr. Corker was convinced that the additional debt that the tax bill would pile on was manageable relative to the country’s $43 trillion balance sheet and that businesses in his home state should have the opportunity for the additional foreign investment and other benefits that he believed the tax cuts would facilitate.
He said that he planned to make fiscal restraint a priority next year as Republicans move on to other initiatives like infrastructure and wanted to ensure that any legislation to help rebuild America’s roads and bridges was actually paid, and not financed, through deficit spending. After 2018, when his term expires, Mr. Corker’s future is less clear. But he said he was not ruling out running for office again in some capacity.
The final bill was not a ‘home run,’” Mr. Corker said, noting that he was at peace with his choice.
Advertisement
Continue reading the main story
“I feel like it was the right decision. I have no qualms about it,” Mr. Corker said.
Continue reading the main story
