By Amanda Becker and Steve Holland
WASHINGTON (Reuters) - Congressional Republicans scrambled on Wednesday to hammer out a final tax bill, as U.S. President Donald Trump prepared to make his closing arguments in a speech promoting the party's plan to slash taxes for corporations and wealthy Americans.
With their defeat on Tuesday in an Alabama special Senate election still sinking in, Republicans resumed a frenzied push on Capitol Hill to reconcile within days separate tax plans passed by the Senate and the House of Representatives.
Democrat Doug Jones' capture of the Alabama Senate seat came just hours ahead of a planned Senate-House conference meeting on the Republican tax plans, with key features still unsettled, including the corporate tax rate.
Party leaders aim to vote on a unified Senate-House measure before Christmas, a schedule that would prevent Jones from upsetting the expected vote tallies since he will not likely be seated until late December or early January.
Also Read
A final bill was expected to be unveiled on Friday, with House and Senate votes on it following early next week.
Republican leaders in both chambers were nearing completion of their efforts. "I think we've got a pretty good deal," said Senator Orrin Hatch, chairman of the Senate tax committee.
When Jones, who upset Republican Roy Moore in the deeply conservative Southern state, arrives in Washington, the Republicans' already slim Senate majority will narrow to 51-49, further complicating Trump's agenda.
Senate Democratic Leader Chuck Schumer called on Republicans to delay a vote on overhauling the tax code for the first time in 30 years until Jones can be seated, but that was unlikely.
Senator John Cornyn, the Senate's No. 2 Republican, said the current 52-seat Republican majority poses enough of a challenge.
"We've got to get 51 votes. Every movement you make to get one vote, you risk losing another vote. And trying to reconcile differences with the House, where they're less familiar with our vote counting ... is a challenge," he said.
Republicans were trying to finalize details without increasing the legislation's deficit impact, which could add as much as $1.5 trillion to the national debt over the next decade.
Both the House and Senate bills propose slashing the corporate tax rate to 20 percent from 35 percent, but negotiators were discussing on Tuesday whether to raise that rate to 21 percent in the final bill, lawmakers said.
A one-percentage-point change in the corporate rate would give tax writers about $100 billion of revenues over a decade that could be used in many ways. One could be to repeal a federal tax on inheritances paid by wealthy Americans. Another might be to end the corporate alternative minimum tax.
Some Republicans also want a higher corporate rate to pay for a higher child tax credit.
Tax writers were also debating whether to reduce the top rate for individual taxpayers to 37 percent from 39.6 percent and cap the popular individual deduction for mortgage interest at $750,000 in home loan value, instead of $1 million.
Trump is seeking to sign a tax bill by the end of the year to achieve Republicans' first major legislative victory since they took control of both chambers of Congress and the White House in January.
After hosting Republican lawmakers for lunch on Wednesday, Trump will speak on tax legislation alongside five middle class families who would benefit, senior administration officials said.
He was expected to try to counter claims that the Republican tax plan would largely benefit corporations and the wealthy by saying it would also cut rates for lower- and middle-income taxpayers, who could see additional benefits, such as higher wages, the officials said.
The nonpartisan Joint Committee on Taxation and Congressional Budget Office have both concluded that wealthier taxpayers would disproportionately benefit from the Republican proposals.
(Additional reporting by David Morgan, Susan Cornwell, Richard Cowan and Doina Chiacu; Editing by Kevin Drawbaugh and James Dalgleish)
Disclaimer: No Business Standard Journalist was involved in creation of this content
