The U.S. House of Representatives passed a tax bill that would purportedly incentivize American businesses to grow and expand the Child Tax Credit.
Tax watchdogs have called attention to the bill, claiming that the $79 billion estimated cost to taxpayers is massively undervalued. Should the bill become law, it is intended to sunset in 2025, though experts claim that it is almost certain the provisions will be extended. As reported by The Dallas Express, the total cost over a decade could be more than $600 billion.
The bill passed out of the House Ways and Means Committee earlier this week and then received broad bipartisan support on the floor on February 1. It passed in a 357-70 vote and will now head to the Senate for consideration.
Some detractors of the legislation criticized the provisions pertaining to the Child Tax Credit, which they had hoped would be more substantial. Others argued that the bill does not raise the cap on property, state, and local taxes that can be deducted on federal tax returns, a goal of New York Republican members.
The House Rules Committee passed a separate bill on Thursday to raise the cap. Rep. Chip Roy (R-TX) was the only Republican member of the committee to vote against the proposed bill. That measure is likely headed for a contentious floor vote in the House next week.
The tax bill would also eliminate double-taxation of Taiwanese workers and companies in the United States, allow for disaster relief deductions, and increase the low-income housing credit to 12.5%.
“What’s in front of us tonight is pretty simple,” said Rep. Richard Neal (D-MA), according to PBS News Hour. “Sixteen million children will benefit from the improvement to the child tax credit. That’s a fact.”
Rep. Thomas Massie (R-KY) was one of the few Republicans to vote against passing the legislation.
“What is a refundable tax credit? It’s welfare by a different name. We’re going to give cash payments, checks, to people who don’t even pay taxes,” Massie said, per PBS.
Rep. Matt Gaetz (R-FL) had even stronger words ahead of the vote. He was another Republican to vote no on passage.
“This is not a tax bill,” Gaetz said, according to Roll Call. “It is a welfare bill in drag.”
Ultimately, Republican support for the tax breaks to aid businesses and the credits to help families led to unification between the parties to get the bill through the House and on to the Senate. The bill moved through the House on a special exemption from the Rules Committee, allowing it to go directly to a floor vote.
Senate Finance Committee member Chuck Grassley (R-IA) said he was concerned with the bill because Democrats may use it to improve polling for embattled President Joe Biden before the election. It is not clear when the Senate will take up the bill, per NBC News.
