Today on the Hill: Tax Reform Approaches Final Stage in Senate

The tax reform effort in the Senate has reached its make-or-break moment as Republican leaders hope to put the finishing touches on the package and approve it in the upper chamber today. The plan hit a hiccup yesterday after the Senate parliamentarian ruled that the so-called ‘revenue trigger’ did not comply with Senate rules, briefly bringing the votes of Sens. Bob Corker (R-TN), Jeff Flake (R-AZ), and Ron Johnson (R-WI) on a motion to recommit into doubt. They eventually fell in line, but the fiscal hawks are still seeking a policy change that will help allay some of the costs of the tax reform package – estimated yesterday to be $1 trillion by the Joint Committee on Taxation (JCT) even after accounting for economic growth.

New reports this morning suggest that Sen. Johnson and Steve Daines (R-MT) have won over Republican leadership on a provision to make the bill slightly more generous to pass-through businesses, with the pay-for likely coming from an elimination of the corporate state and local tax (SALT) deduction. With those two on board, the remaining fiscal hawk holdouts will likely face increasing pressure to swallow the cost of the bill or be placated by a more limited change. However, it is important to note that both Sens. Corker and Flake have publicly feuded with President Trump and are not running for re-election beyond their current terms – meaning they may be more willing to buck the party line than other rank-and-file senators. This morning, Majority Whip John Cornyn told reporters that Republicans have the 50 votes needed even without the support of Sen. Corker.

From a timing perspective, Senate Majority Leader Mitch McConnell (R-KY) will resume consideration of the bill at 11am and a vote-a-rama is expected to kick off this afternoon. We’ve heard that amendment votes are likely to begin at some point between 2pm and 6pm. Assuming that Republicans are confident they can get to 50 votes, the submission of a manager’s amendment and final up-or-down vote would likely come late tonight or possibly even in an unusual Saturday session tomorrow. For their part, the House is fully expecting for the Senate to successfully approve the package as Republican leaders are bringing the lower chamber in session on Monday in order to approve an anticipated motion to go to conference on the tax bill.