Tax cuts may NOT be a done deal as conservative Freedom Caucus members rebel and companies push for key measure to be changed

  • Several members of the right-wing House Freedom Caucus tried to block a routine vote to move the tax cut bill forward
  • They're complaining about a pre-Christmas budget deal that they see as too liberal on immigration, health care and other subjects
  • Having made their point, the dissenters ultimately backed down
  • Separately, Republicans are under revolt from corporate leaders who are angry that the Senate's version of the bill kept the business Alternative Minimum Tax
  • Cuts to corporate rates could mean more firms would be stuck paying the AMT, which would disallow many of their favorite deductions?

Several members of the conservative House Freedom Caucus threw a brush-back pitch Monday night calculated to stall the Republican-backed tax reform plan.

On what normally would have been a routine – but crucial – vote to send the all-important tax bill to a House-Senate conference committee, caucus chairman Rep. Mark Meadows and about a dozen other Republicans held back their support.

The conservatives were trying to get the attention of House leaders, who were marching ahead with a plan for a pre-Christmas budget agreement that has the potential for dealing conservatives losses on immigration, health care, and money for domestic agencies and hurricane recovery.

'One person says disruption. We like to say we're doing what we told the voters we were going to do,' said Ohio Republican Rep. Jim Jordan, former chair of the Freedom Caucus. 'That's what we're doing.'?

Having made their point, the dissenters ultimately backed down?

Separately,?Republicans are grappling with a thorny question about corporate taxes as they work to reconcile competing tax bills from the Senate and House.

Speaker of the House Paul Ryan had to deal with a revolt on his right flank Monday night from conservatives who held up a routine vote advancing the tax-cut bill because they're upset over budget priorities

Speaker of the House Paul Ryan had to deal with a revolt on his right flank Monday night from conservatives who held up a routine vote advancing the tax-cut bill because they're upset over budget priorities

Rep. Mark Meadows, chairman of the conservative Freedom Caucus, staged the protest with other group members during a closed-door strategy session with House Republicans

Rep. Mark Meadows, chairman of the conservative Freedom Caucus, staged the protest with other group members during a closed-door strategy session with House Republicans

The Senate bill that squeaked through on a 51-49 vote last week jettisoned a long-held Republican goal of repealing the corporate Alternative Minimum Tax to help pay for last-minute deals that secured the Republican votes for passage.?

That puts Senate Republicans on a collision course with Republicans in the House of Representatives, whose own tax bill repeals the corporate AMT and who are already calling for the tax to be eliminated in final legislation.

The corporate AMT combines a low 20 per cent rate with fewer tax breaks, and kicks in if a firm's final tax rate falls below a set threshold.

Most companies aren't caught up in the AMT since they pay a 35 per cent tax rate on their income. But the GOP plan calls for a new top rate of 20 per cent, which means that more firms will end up paying the AMT and losing a wide variety of deductions in the process.

Tuesday's delay on a budget deal underscored the clout that conservatives wield within the House GOP as the party aims to push legislation through the House and Senate this week to keep federal agencies functioning.?

A partial shutdown would occur at midnight Friday night unless the Republican-led Congress approves more money, and a closure due to GOP fissures would be a jarring political blow to a party straining all year to show it can govern effectively.

The short-term legislation is designed to give bargainers more time to address remaining disputes over spending levels and other issues that have been folded into the year-end mix, including immigration and health care. Congressional leaders from both parties plan budget talks with President Donald Trump at the White House on Thursday.

Senate Majority Leader Mitch McConnell's version of the tax bill kept the corporate Alternative Minimum Tax in place, which upsets business advocates who don't want to be lumped into the program that disallows many of their lucrative deductions

Senate Majority Leader Mitch McConnell's version of the tax bill kept the corporate Alternative Minimum Tax in place, which upsets business advocates who don't want to be lumped into the program that disallows many of their lucrative deductions

Speaker Ryanis grappling with a looming deadline to pass a spending bill to fund the government by week's end

Speaker Ryanis grappling with a looming deadline to pass a spending bill to fund the government by week's end

Without support from their own conservatives, House GOP leaders would need backing from Democrats to push a temporary measure through the chamber. Democratic votes will definitely be crucial in the Senate, where Republicans by themselves lack the 60 votes needed to approve the legislation.

Democrats hope to use their leverage in the year-end budget battle to win concessions on spending, immigration and other issues. They have yet to say what they will do.

In further indication of the problems GOP leaders face, 34 House Republicans sent a letter to House Speaker Paul Ryan, urging him to hold a vote by year's end on extending protections for hundreds of thousands of immigrants who arrived in the U.S. illegally as children. Trump ended those protections this fall and Democrats are demanding that they be renewed in the year-end rush of business.

Earlier Tuesday, Ryan declined to describe the status of internal GOP budget talks after House Republicans met privately to discuss their next steps.

'We're having a conversation with our members about what we think the best way forward is,' he told reporters. 'You'll see when we bring the bill to the floor.'

North Carolina Republican Rep. Mark Meadows, head of the hard-right House Freedom Caucus, said his group was having 'a good, healthy discussion' with leaders about ways to 'fund the government without putting our military at a disadvantage.'

On Monday, the Freedom Caucus pressured GOP leaders for the short-term bill to run through Dec. 30, not Dec. 22 as has been planned. Conservatives say setting the deadline before Christmas, when lawmakers want to go home, gives Democrats more leverage to get higher spending into the legislation.

Several Republicans said after Tuesday's meeting that the bill would likely run through Dec. 22 but said there were no final decisions. One Freedom Caucus member, Rep. Dave Brat, R-Va., said conservatives wanted leaders' assurances that they wouldn't agree to unacceptably higher spending.

'It's always the load-up-the-Christmas-tree play, go get Democrat votes, bust the budget caps,' Brat said of past spending showdowns when Democratic votes were needed.

Across the Capitol, Senate Majority Leader Mitch McConnell, said that besides temporarily financing the government, the short-term measure would make cash available to several states that are running out of money for the Children's Health Insurance Program. That widely popular program helps provide medical care to more than 8 million children.

McConnell, a Kentucky Republican, said he was hoping that Senate Minority Leader Chuck Schumer and other Democrats 'will continue to work with us in good faith to pass this short-term funding bill and maintain the critical functions of the federal government.'

On Monday, McConnell expressed more confidence, saying, 'We will pass it before the end of the week.'

With the budget chafing under spending caps imposed by a 2011 bipartisan budget deal, Democrats want defense and domestic programs to get equal funding increases. Both sides say they want to provide money for a health insurance program that serves more than 8 million children and for states battered by recent storms.

In addition, some from both parties want to restore billions in federal payments to health insurers that Trump halted last autumn. There are also demands for money for battling opioid abuse.

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