House GOP scrambles to finalize tax bill

Associated Press

WASHINGTON

House Republicans would leave intact current tax rules on retirement accounts popular with middle-class Americans and maintain a top income-tax rate for million-dollar earners as negotiators scrambled to finalize the first major overhaul in three decades.

The legislation is a long-standing goal for Capitol Hill Republicans who see a once-in-a-generation opportunity to clean up an inefficient, loophole-cluttered tax code.

But there is lingering opposition from northeastern Republicans fearful of losing a cherished deduction for state and local taxes and anxiety among other rank-and-file lawmakers over emerging details.

Senior GOP lawmakers confirmed the decision to retain existing rules on 401(k) accounts, which came after assurances from President Donald Trump that they would not be changed.

Another lawmaker cautioned that the decision might still change.

Top Republicans vowed to release the measure today after missing a self-imposed Wednesday deadline and dismissed rumors that the unveiling might be further delayed.

“Failure is not an option,” said Rep. Chris Collins, R-N.Y.

The ambitious timetable calls for passing the measure in the House by Thanksgiving.

The emerging plan would retain the income-tax rate for the wealthiest earners. But for that highest bracket, the tax writers were considering raising the minimum level of income to $1 million from the current $470,000 – a change that would reduce tax revenue.

The plan also would sharply cut tax rates for businesses in hopes of improving U.S. economic competitiveness. Tax rates for individuals would be trimmed as well.

Democrats have repeatedly complained the plan was too favorable to business and the wealthy and contradicted Trump’s rhetoric of bringing relief and economic benefit to the stressed middle class.