(THREAD) Epic screw-up in the tax bill the Senate just passed. They lowered the corporate rate to 20%, but accidentally put in an alternative minimum tax (AMT) of 20%. That's right. The same rate. (Maybe rushing it through wasn't the best idea). Here are some implications:
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Turns out Republicans passed something like actual corporate tax reform. It effectively wiped out a bunch of deductions (since claiming them doesn't result in savings) and lowered rates. Companies will compete based on who has the best business, not who has the best lobbyists 2/x
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But companies are pissed. Especially well-connected companies that got the government to give them special tax breaks. Real tax reform is a great idea. But that wasn't Republicans' main goal. Now the bill doesn't funnel nearly as much money to rich people as they thought. 3/x
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That means the Senate has to pass another tax bill. Lower the corporate rate *and* makes sure they can keep their tax breaks. Of course, they could roll with real tax reform instead. That would help the countr-- ah, who am I kidding? 4/x
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It wasn't easy to sneak the tax bill through the Senate. They had to refuse hearings and expert testimony, make changes by hand, and pass it quickly. For comparison, Obamacare took over a year, left months between committee and floor votes, and had 44 Senate hearings. 5/x
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To send a bill to the president, House and Senate must pass identical versions. Republicans could have avoided the gamble of putting up another bill for a Senate vote by having the House pass the Senate version. That's what Democrats did with Obamacare after Ted Kennedy died. 6/x
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But the epic screw-up--reinstating an AMT but accidentally making it the same as the normal rate--means the House can't pass the Senate version. Well, they could. But then it wouldn't funnel as much money to people with a lot of money. Plus there are other, lesser screw-ups. 7/x
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Replying to @NGrossman81
Could they hash this all in conference? They could both agree and send it to the Desk for signing?
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Replying to @castironstraw
They'll have to hash it out in conference. But if the result is even a tiny bit different than what a chamber passed, that chamber has to hold a vote to pass the conference version.
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Replying to @NGrossman81
So they have put this bill in jeopardy on a technicality? I find it hard to believe they wouldn’t all agree to cancel or reduce the AMT.
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Minimum: they'll need to hold another vote. Which means there's more time for debate, constituent pressure, etc. Either way, it won't be simple. The higher AMT raised more revenue, allowing it to pass by Senate rules. If they lower the AMT, they have to raise money elsewhere.
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Replying to @NGrossman81
Good point. Makes for some interesting backpedaling.
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