House Republicans on Tuesday passed their final plan to slash individual and corporate taxes, a vote that will put President Trump in a position this week to be the first president since Ronald Reagan to sign major tax reform into law.
The Senate was expected to follow up with a narrow vote to pass the same bill late Tuesday evening, after which it will head toward Trump's desk. Republicans said the votes meant they met their commitment to pass the bill before Christmas, and their broader campaign commitment to let people and companies around the nation keep more of their own money.
“This is the greatest example of a promise being made and a promise being kept,” House Speaker Paul Ryan, R-Wis., said of the tax overhaul just before the vote. “It’s been a long, long time. It’s an honor to be Speaker of the House to see this.”
Ryan also cast the vote as a blow against a federal government that he said has demanded too much of the people's money for decades.
"For years, the powers-that-be have blocked and stonewalled reform under the umbrella of an arrogant, condescending, and paternalistic ideology," Ryan said. "An ideology that seeks to limit mobility, to limit aspirations, to accept less in our lives."
This is our country. This is our moment. We will reclaim the principles that have guided us for generations so that our nation is more united, more confident, and more free. pic.twitter.com/9EpTgQg4wK— Paul Ryan (@SpeakerRyan) December 19, 2017
The 227-203 vote in favor of the bill was a slight improvement over the 227-205 vote in November for the first version of the bill. In November, 13 Republicans voted against the bill, but only 12 did Tuesday. The difference in the "no" column for Republicans was Rep. Tom McClintock, who voted against the bill in November but supported it Tuesday.
No Democrats voted for either version of the House bill.
The centerpiece of the bill is a reduction of the corporate tax rate from 35 percent to 21 percent. It would also lower individual tax rates, bringing the top rate down to 37 percent, and create a special new low-tax regime for businesses that file through the individual side of the code.
The bill would offset the lower tax rates and doubling of the standard deduction by paring back around $3.5 trillion of existing deductions and tax breaks in the code. The measure would still be a net $1.5 trillion tax cut over the next decade.
But the bill also delivers a hit to Obamacare, as it would repeal the individual mandate penalty, which Republicans say will effectively eliminate one of the law's most odious aspects of the law: the requirement for people to buy health insurance.
The vote followed a week of negotiations between House and Senate lawmakers, during which the bill was changed to make it more politically marketable for House Republicans in blue states who could be vulnerable in 2018. For example, the conference bill includes a bigger remnant of the state and local deduction for taxpayers in high-tax states like New York and California, and lower individual rates meant to ensure that taxpayers on the margin aren’t hit with tax increases.
As the vote progressed, Republican representatives approached the bill's author, House Ways and Means Committee chairman Kevin Brady of Texas, to get his autograph on the conference report for the bill.
The stock market has been rallying for weeks on the promise that the bill would soon pass and be signed into law. Businesses and conservative groups, who have undertaken multi-million dollar ad campaigns backing the tax reform, urged Republicans Tuesday to finish the job and send the bill to Trump’s desk.
Democrats, however, rallied against the bill Tuesday with the families of disabled people, arguing that the loss of revenues would imperil government programs for the sick and poor in the years to come.
“This is the worst bill to ever come to the floor of the House,” said Democratic Leader Nancy Pelosi. She called it the “worst bill in history, because of the number of people it affects, the amount of money it sucks up to the higher income, and the impact on our future deficits.”
On the House floor, Pelosi called the bill a "Frankenstein's monster" that would come back to haunt Republicans in the 2018 midterm elections. She was backed up by protesters who sat in the gallery and chanted "kill the bill" toward the end of the debate.
Later, another protester interrupted Ryan while he made his closing arguments on the floor in favor of the bill.
Democrats won the early messaging war over the bill in the lead-up to its passage, as polls show that it was mostly unpopular and that the majority of people feared that it would hike their taxes. One new poll out Tuesday, however, showed that a plurality of voters support the bill.
Republicans urged Democrats to ignore their party leaders and vote for a bill that would help millions of families, but to little avail.
"Vote for a tax cut, vote for reform. Don't vote because some leader whipped you and intimidated you," said House Majority Whip Kevin McCarthy, R-Calif.
Republicans said they were willing to bet that passage would, in time, prove to be a political winner for them, and said they expect families to get tax cuts starting next years and for business to pick up.
“Results are going to make this popular,” said Ryan.
"On February 1st, look at your paycheck, because you'll see the tax relief we delivered today," said Brady.