The U.S Senate Republicans passed a $1.5 trillion-dollar tax bill on Saturday morning, December 5, 2017. This tax bill will grant extreme benefits on the wealthy as well as corporate America, and will do the opposite for those who don’t find themselves in those higher-class categories. Republicans, including St. Lawrence University alum, Senator Susan Collins, voted close to unanimous to pass this bill. Bob Corker of Tennessee was the only Republican to hold out against the bill, standing behind each and every Democrat voting no.
The main purpose of the GOP plan is to lower corporate tax rates from 35 percent to 20 percent, starting in 2019. The corporate tax rate is a tax imposed on the net income of a specific company. The Senate tax bill is also said to temporarily cut tax rates for individuals and families until the year 2025. The bill would also demolish various tax benefits. The Washington Post reports, “It would subject fewer people to the estate tax, a levy charged on huge inheritances, but stop short of eliminating that tax altogether.” In the most recent review of the new tax bill, the Joint Committee on Taxation, Congress’s non-biased tax analysts, found that only 44 percent of taxpayers would see their burden reduced by more than $500 in 2019. The committee also found that high earners would manage much better than lower income individuals under the new bill.
The bill is not just bonded to the tax code itself; it will repeal the individual mandate from the Affordable Care Act as part of a broader GOP effort to dismantle the Obama-era law. The individual mandate created penalities for those American citizens who did not have health insurance, but the repeal would leave 13 million more people uninsured. The bill will also allow oil drilling to occur in the Arctic National Wildlife Refuge in Alaska. In addition, the bill will increase deductions for state and local states, thereby placing stress on some states and local counties to spend more on school systems, transportation and public health programs, due to budget-cuts.
The tax bill has still not been entirely cleared; it still has a few more hurdles to surpass before becoming a law, including being approved by President Trump. The House and Senate versions of the bill seem to contain numerous differences, and complications may arise, though unlikely, when making the final decision on certain tax cuts and estate taxes. The negotiations will continue as Congress has a deadline of December 8 to make a decision, due to government funding. President Trump has been quoted saying, “This is going to cost me a fortune, this thing – believe me,” and “I have some very wealthy friends, not so happy with me, but that’s okay.” President Trump is trying to defend not only the Americans of higher socio-economic standing, but also himself. He wants to be clear that he will not benefit from the new tax bill, though many Democrats have alleged this is untrue.