Just when the Republicans were ready to have a big “we got you where we want you party,” the senator from Maine, Susan Collins, says she’s not “all in” on the vote to lower corporate taxes. She is not in favor of sticking it to the people who actually make money for these capitalistic demigods. It seems several Republicans didn’t like the Senate bill, so they threw in amendments that would make their yes vote more attractive to their constituents.
Senator Collins threw two amendments into the legislation pot last week, and one of them was allowing taxpayers to continue deducting property taxes from their annual tax return. The Republican tax bill eliminates mortgage and property tax deductions. Both deductions are important to millions of taxpayers. The House bill didn’t touch the property tax deduction, but the Senate bill did, and the Collins amendment would keep that deduction in the final bill. The other Collins amendment would lower the threshold on deductions for medical expenses.
Plus, the Maine senator is still an avid Affordable Care Act proponent. She is one of the senators that put a monkey wrench in the Republican effort to repeal what Trump likes to call Obama Care. According to Collins, some people believe the tax bill, in its current state, would trigger a four percent cut in Medicare, but Collins got written assurance from House Speaker Paul Ryan and Senate leader Mitch McConnell that would not happen. Collins believes her amendments would make the cut when the House and the Senate produce a final tax bill, but anything can happen behind the closed doors of Washington.
The lowering of the Corporate tax from 35 percent to 20 percent is the main reason the Republicans are moving faster than a speeding bullet to turn this tax reform debacle into law. The current alternative minimum tax (AMT) which makes sure corporations pay a base-level of taxes, instead of avoiding them altogether, didn’t make the tax reform bill. But in a frantic effort to get this tax bill rewritten, the senators put the AMT rate back in the bill. If the AMT stays in the final bill, corporations that might pay less than 20 percent in taxes without the AMT clause would have to pay at least 20 percent. The thought of not be able to wiggle around and pay less than 20 percent under the new tax bill is making a lot of big corporations nervous.
The reason the alternative minimum tax is in the bill is simple. The alternative minimum tax would produce more than $300 billion in revenue by the year 2027. That $300 billion would reduce the $1 trillion tax cut Republican senators are promising corporate America. In other words, the AMT provision is a big issue and needs attention, according to some Republican senators.