WASHINGTON • Republicans in the US House of Representatives have unveiled a tax Bill that would cost US$1.5 trillion (S$2 trillion) and deliver deep tax cuts as promised by President Donald Trump, setting off a race in Congress to give him his first major legislative win.
In what would be the largest overhaul of the US tax system since the 1980s, Republicans on Thursday called for slashing the corporate tax rate to 20 per cent from 35 per cent, and cutting tax rates on companies' foreign profits and on individuals and families.
Congressional passage of the legislation, which would affect nearly every US company and family, was far from certain. Some business groups quickly came out against it and Democrats swiftly condemned it as a giveaway to the rich.
Contentious provisions will test Republicans, who control the White House and both chambers of Congress, but have been unable to deliver major legislative achievements for Mr Trump since the businessman-turned-politician became President in January.
A number of provisions in the Bill would hit taxpayers in Democratic-leaning states hardest, such as rolling back deductions for state and local taxes and cutting in half the popular mortgage interest deduction. The plan has already been met with resistance from small businesses, realtors and homebuilders.
Titled the Tax Cuts and Jobs Act, it would benefit wealthy Americans by lowering their income taxes, cutting corporate and other business taxes, phasing out over six years the estate tax on inherited assets and repealing the alternative minimum tax.
"This is a very important and special moment for our country, for all Americans," said Republican House Speaker Paul Ryan.
Meeting Mr Ryan and other key House Republicans, Mr Trump applauded the Bill as an "important step" towards tax relief, and repeated his request that Congress send him the legislation to sign into law by the Thanksgiving holiday on Nov 23.
That is an ambitious timetable for such a multi-faceted proposal that will face a ferocious lobbying battle among business sectors affected by the Bill and determined opposition from most Democrats in Congress. It also must pass the Senate, where Republicans hold a slimmer 52-48 majority and failed earlier this year to garner enough votes to approve a major healthcare overhaul sought by Mr Trump.
The Bill condenses the existing seven tax brackets into four, plus an effective fifth bracket at zero per cent. Critically, it keeps the top rate for wealthy taxpayers at 39.6 per cent, rather than 35 per cent as proposed in September under the White House tax outline. But it also raises the threshold for the top bracket to US$1 million for married couples, from the US$470,700 currently - meaning a major tax break for earners within that window.
"Ultimately, what the American people really get from this tax plan is a huge bill for the debt incurred to pay for tax breaks that line the pockets of Donald Trump personally along with his billionaire buddies. Like a Trump University degree, it is phoney," said Texas Democratic Representative Lloyd Doggett.
REUTERS, AGENCE FRANCE-PRESSE