The House approved a $620 billion package of popular tax breaks Thursday, clearing the first half of a year-end deal Congress negotiated with the White House to fund the government in 2016 and inject certainty into the IRS code.
Nearly every Republican teamed with 77 Democrats to pass the so-called “extenders” bill, 318-109 — overcoming gripes that Congress was hiking the deficit so it could hand out Christmas gifts to special interests.
The House will vote Friday morning on the $1.15 trillion spending part of the deal, then send the entire package over to the Senate for final approval later in the day.
“With this tax bill, families and businesses are going to have the long-term certainty that they need, instead of scrambling year after year to find out what’s next,” Speaker Paul D. Ryan, Wisconsin Republican, said.
Tax breaks on everything from race horses and film productions to NASCAR racetracks, college tuitions and teachers’ out-of-pocket classroom expenses are covered in the massive deal.
It also delays the excise tax on medical device sales — part of Obamacare that took effect in 2013, but would be nixed in 2017 and 2018, depriving the government of about $4 billion in revenue.
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Democrats won extensions of the child tax credit and earned income tax credit, among other priorities, but most of them opposed the bill anyway, complaining that it gave too much to corporate interests while leaving taxpayers in the lurch.
Congress is waiving its own budget rules to pass the bill without any offsets, meaning the deficit will deepen over the next decade.
“Having all of that unpaid for, in my view, is unconscionable,” House Minority Leader Nancy Pelosi, California Democrat, said.
Senate leaders agreed to hold their vote on Friday, heading off Sen. Marco Rubio, a Florida Republican running for president, who said on the campaign trail that he wanted to try to slow things down.
Friday’s House vote on the spending part of the bill could be touchy. Democrats, who prevailed on most of the fights within that portion of the bill, said it’ll be up to Republican leaders to produce the votes to pass the bill.
“We have some serious objections which we’ve been made know all along. So, we’ll see. We’ll see,” Mrs. Pelosi said.
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In particular, Democrats object to a provision that ends a ban on U.S. crude oil exports. Democrats won the biggest hike in history on clean energy spending in exchange for lifting the ban, but a number of rank-and-file lawmakers said that wasn’t enough to earn their support.
Mr. Ryan said the tax portion of the deal will pave the way for Congress to do a broader overhaul of the tax code down the road by narrowing the areas of debate. The bill makes a handful of popular tax breaks permanent, and extends others for several years.
“With this bill in place, Americans will no longer have to worry each December if Congress will take action to extend certain tax relief measures that they’ve come to rely upon,” said Ways and Means Chairman Kevin Brady of Texas, who wrote the bill with Sen. Orrin G. Hatch, Utah Republican and chairman of the Senate Finance Committee, and Sen. Ron Wyden of Oregon, the ranking Democrat on the Finance Committee.
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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