“Congressional Republicans delivered an epic overhaul of U.S. tax laws to President Donald Trump on Wednesday,” Stephen Ohlemacher and Marcy Gordon report for The Associated Press. “The vote was 224-201 and came hours after the Senate’s early morning passage along party-lines. Republicans cheered when the vote tally hit the magic number for passage, and again when the final vote was announced.”
“Tax cuts for corporations would be permanent while the cuts for individuals would expire in 2026 to comply with Senate budget rules,” Ohlemacher and Gordon report. “The tax cuts would take effect in January, and workers would start to see changes in the amount of taxes withheld from their paychecks in February.”
“The legislation repeals an important part of the 2010 health care law — the requirement that all Americans carry health insurance or face a penalty — as the GOP looks to unravel the law it failed to repeal and replace this past summer. It also allows oil drilling in the Arctic National Wildlife Refuge,” Ohlemacher and Gordon report. “The $1,000-per-child tax credit doubles to $2,000, with up to $1,400 available in IRS refunds for families that owe little or no taxes.”
Full article here.
“The House overcame a final hurdle by voting Wednesday to approve a sweeping overhaul of the nation’s tax code, sending the legislation to President Donald Trump’s desk for signature,” Christina Wilkie and Jacob Pramuk report for CNBC. “The plan, expected to become law for next year, would significantly remake the U.S. tax code for the first time in decades . The bill would slash tax rates for businesses while temporarily trimming the tax burden on most, but not all, individuals.”
“The chamber passed the legislation by a 224-201 margin,” Wilkie and Pramuk report. “‘Today, Congress approved a once-in-a-generation tax reform bill. This is the end of a long journey to deliver major tax relief to the American people,’ House Speaker Paul Ryan said in a statement Wednesday. By passing the tax reform bill in a reconciliation period, the GOP-controlled Senate was allowed to adopt the bill with just a simple majority, and not the 60 votes typically needed to advance a Senate bill to the floor for a vote. After tweaking the language in the bill, the Senate passed it in the wee hours of Wednesday, by a party-line 51-48 vote. Sen. John McCain, R-Ariz., is in his home state of Arizona fighting brain cancer.”
“The tax bill represents the signature legislative achievement of Trump’s first year in office… ‘I promised the American people a big, beautiful tax cut for Christmas. With final passage of this legislation, that is exactly what they are getting,’ Trump said in a statement, saying that the legislation pours ‘rocket fuel’ into the U.S. economy,” Wilkie and Pramuk report. “Speaking after the Senate vote Wednesday morning, [Senate Majority Leader Mitch] McConnell called passing the bill an ‘important accomplishment’ that taxpayers will ‘value and appreciate.’ ‘If we can’t sell this to the American people, we ought to go into another line of work,’ he told reporters.”
I would like to congratulate @SenateMajLdr on having done a fantastic job both strategically & politically on the passing in the Senate of the MASSIVE TAX CUT & Reform Bill. I could have not asked for a better or more talented partner. Our team will go onto many more VICTORIES!
— Donald J. Trump (@realDonaldTrump) December 20, 2017
Read more in the full article here.
“In addition to cutting the U.S. corporate income tax rate to 21 percent, the debt-financed legislation gives other business owners a new 20 percent deduction on business income and reshapes how the government taxes multinational corporations along the lines the country’s largest businesses have recommended for years,” David Morgan and Amanda Becker report for Reuters.
“Millions of Americans would stop itemizing deductions under the bill, putting tax breaks that incentivize home ownership and charitable donations out of their reach, but also making tax returns somewhat simpler and shorter,” Morgan and Becker report. “The bill keeps the present number of tax brackets but adjusts many of the rates and income levels for each one. The top tax rate for high earners is reduced. The estate tax on inheritances is changed so far fewer people will pay.”
“In two provisions added to secure needed Republican votes, the legislation also allows oil drilling in Alaska’s Arctic National Wildlife Refuge and removes a tax penalty under the Obamacare health law for Americans who do not obtain health insurance,” Morgan and Becker report. “‘We have essentially repealed Obamacare and we’ll come up with something that will be much better,’ Trump said on Wednesday.”
Read more in the full article here.
MacDailyNews Take: The importance of the U.S. finally moving to a territorial system cannot be overstated.
As we’ve been saying for many years now, the U.S. corporate tax rate was obviously way too high and anachronistic, as Apple CEO Tim Cook agreed:
Under the current U.S. corporate tax system, it would be very expensive to repatriate that cash. Unfortunately, the tax code has not kept up with the digital age. The tax system handicaps American corporations in relation to our foreign competitors who don’t have such constraints on the free flow of capital… Apple has always believed in the simple, not the complex. You can see it in our products and the way we conduct ourselves. It is in this spirit that we recommend a dramatic simplification of the corporate tax code. This reform should be revenue neutral, eliminate all corporate tax expenditures, lower corporate income tax rates and implement a reasonable tax on foreign earnings that allows the free flow of capital back to the U.S. We make this recommendation with our eyes wide open, realizing this would likely increase Apple’s U.S. taxes. But we strongly believe such comprehensive reform would be fair to all taxpayers, would keep America globally competitive and would promote U.S. economic growth. – Apple CEO Tim Cook, May 21, 2013
Republican-controlled U.S. Congress poised to approve biggest tax system overhaul in 30 years – December 19, 2017
GOP tax cut plan sets 15.5% repatriation rate on offshore cash; 8% if invested in plants and equipment – December 16, 2017
GOP eyes taking bigger bite from Apple, others holding cash overseas to seal President Trump’s tax cuts – December 15, 2017
Apple could be biggest beneficiary of Republican tax reform plans, saving at least $47 billion – December 6, 2017
Dow soars 203 points higher to record as Wall Street cheers U.S. Senate passage of major tax bill – December 4, 2017
Oracle joins Apple in support of President Trump’s tax repatriation plan – November 7, 2017
President Trump’s tax cuts could be YUGE for Apple – September 28, 2017
GOP tax plan calls for cutting the corporate tax rate from 35 percent to 20 percent – September 27, 2017
Goldman Sachs sees $1 trillion in U.S. tax cuts coming – September 20, 2017
Apple will eventually bring billions of dollars back to the U.S. under President Trump’s tax reform plan – July 21, 2017
President Trump’s tax reform plan includes deep cuts in corporate taxes – April 26, 2017
Apple could be primed for profit explosion under President Trump’s big tax cut – April 26, 2017