Republican leaders revealed their “Tax Cuts and Jobs Act” to mostly positive reviews from their rank-and-file members on Thursday, although GOP lawmakers hedged their support as they await a more detailed text.
“People are pretty happy,” Rep. Dave Brat, R-Va., said after the closed-door meeting in which GOP leaders presented the new proposed tax brackets and loophole closures they hope to pass into law this year.
Republican leaders also appear to have addressed the concerns of a faction of New Jersey and New York lawmakers who protested the proposal to eliminate the deduction for local and state taxes. The plan now keeps the property tax deduction, but the benefit will only apply to the first $10,000 in those local taxes.
“It appears there has been a good faith effort to address that,” said Rep. Lee Zeldin, R-N.Y., who led the charge to keep the deduction.
The mortgage interest deduction was maintained but lowered to $500,000, down from one million dollars currently.
Lawmakers said the new cap would ensure most people will benefit.
Rep. Chris Collins, R-N.Y., said that issue is now nothing to fight over, and said the language “takes care of 90 percent-plus of all Americans.”
Rep. Jason Lewis, R-Minn., said he does not foresee a negative impact on the mortgage interest cap in his district, where sales on homes priced higher than $500,000 are selling at a slower pace.
“I think we’ve preserved the mortgage interest deduction for the vast majority of home buyers,” Lewis said.
Lewis said he anticipates pushback from groups who will vigorously advocate for keeping the current caps, which he said now favor the wealthy.
“Let’s not hold middle-class tax cuts on rate reductions hostage to that stuff,” Lewis said. “We are trying to compress the rates, get the marginal rates down to incentivize production and work and savings. The purpose of tax reform is to eliminate deductions and have a lower rate and a broader base.”
