WASHINGTON — The Senate rejected a bill Thursday that would have restored lapsed tax breaks for businesses and expanded the child tax credit, as many Republicans in the chamber lined up against the bipartisan deal in hopes of gaining an advantage in bigger tax legislation expected next year.
The roughly $80 billion bill had seemed to have everything. It soared through the House earlier this year with broad bipartisan support, a rare feat. Business groups loved it and hoped Congress would again allow companies to immediately deduct the full cost of capital investments and research expenses from their tax bills. And anti-poverty activists cheered its expansion of federal support for parents with children.
But the effort — spearheaded by Rep. Jason Smith, R-Mo., the Ways and Means Committee chair; and Sen. Ron Wyden, D-Ore., the Finance Committee chair — still ran aground in the Senate. Republicans senators worried that the bill’s expansion of the child tax credit veered into creating a new welfare program, stalling the legislation.
Though Republican opposition doomed the bill’s fate months ago, Sen. Chuck Schumer, D-N.Y., the majority leader, brought it up for a procedural vote Thursday. The vote failed 48-44, falling short of the 60 votes needed to advance. Three Republicans joined Democrats in favor of the bill, while two independents who caucus with Democrats — Sen. Joe Manchin III of West Virginia and Sen. Bernie Sanders of Vermont — opposed it. Schumer also ultimately voted against the bill, a decision that allows him to potentially bring it back up for another vote.
The attempt to pass the tax bill was also a dry run for a broader tax debate that Congress will undertake next year. Many tax cuts approved by President Donald Trump and a Republican Congress in 2017 will expire after 2025.
Top Senate Republicans reasoned that they may be in a better negotiating position after November’s election, when they could win control of the chamber.
Still, the decision was a disappointment to many business lobbyists. The tax breaks they sought had lapsed under provisions in the 2017 tax law; Republicans ended them as a way to contain the cost of that legislation. Because the tax breaks incentivize investment and scientific research, they are largely uncontroversial and were expected to be reinstated.
This article originally appeared in The New York Times.
© 2024 The New York Times Company
