U.S. Sen. Tim Scott, R-SC, said Monday that he believes Congressional Republicans will iron out significant differences between separate proposed tax bills passed in the past month by the Senate and the House of Representatives.
Senate Republicans passed early Saturday morning a $1.5 trillion Tax Cuts and Jobs Act bill that could overhaul the tax code, marking a significant win for President Donald Trump and his administration. The House had passed its own rewrite of the tax code last month.
Key decision-makers in both Congressional chambers now will take part in a conference committee to reconcile differences between the two plans. If the two chambers are successful, the legislation could be on Trump’s desk by the end of the year. The president has promised Americans a “huge tax cut for Christmas.”
The Associated Press reports there are several key differences between the bills. The House bill would make individual tax cuts permanent, while the Senate bill would end tax breaks for individuals in 2025. The Senate bill repeals the Affordable Care Act’s individual mandate, while the House bill does not. The House bill calls for a repeal of the alternative minimum tax, while the Senate bill leaves it alone.
Scott said Monday morning he believes the two chambers can reach agreement. He said the proposed tax reform efforts will positively impact individuals, small businesses and large companies.
“Harmonizing the two bills will be an interesting path for the next few weeks,” he said. “I think we’ll get it done very quickly. We’ll bridge that gap quickly.”
Scott said about “95 percent” of the tax reform efforts are agreed on, while “three or four significant differences” are still up for debate.
Scott had come to Chester County to tour the new Giti Tire plant.
Scott said it was important to attract companies like Giti Tire, which want to invest in American manufacturing facilities from abroad. He said the lowered tax rate would make states like South Carolina more competitive with other sites overseas.
Earlier this year, Giti Tire officials announced plans to hire up to 1,700 workers over the next decade to work at a $560 million, 1.6 million-square-foot mega-plant off Lancaster Highway in Richburg.
“It’s a great time to be an American company,” Scott said. “This is an important part of the equation.”
Slashing the corporate tax rate from 35 percent to 20 percent, as proposed in the Senate version, would mean good things for employee wages, Scott said. He said he’s heard from economists on both sides that dropping the tax rate would lead to an increase in wages.
Trump initially lobbied for a 15 percent tax rate, but expressed a willingness over the weekend to settle for 22 percent if it results in a compromise.
“The folks on the right, they say it could be as much as a 75 percent benefit to employees,” Scott said. “The friends on the left say 25-40 percent is more realistic. Anything that’s beneficial to the workers, the answer is yes.”
Scott’s colleague, U.S. Sen. Lindsey Graham, R-SC, also backed the passage of the Senate’s plan. Graham said the reform was “desperately needed” and believes it will grow the economy.
Graham said the average working family would see a $2,300 tax cut under the Senate plan. Scott said a single person, earning about the average as the head of household at $41,000 a year, could earn a 75 percent tax cut.
“That’s money to help raise your kids and do things you need to do with the family budget,” Graham said.
U.S. Rep. Ralph Norman, R-SC, told The Herald last month he felt “90 percent certain” that Republican congressional leaders would be able to agree on a bill.
Norman was among 227 House Republicans who voted to approve the Tax Cuts and Jobs Act. Thirteen Republicans voted against the bill, while no Democrats voted for it.
“It’s a victory for the taxpayer, not the tax collector,” said Norman of Rock Hill. “It’s not just a slogan, it’s true.”