House Speaker Paul Ryan, R-Wis.(Photo: J. Scott Appelwhite, AP)
WASHINGTON<span style="color: Red;">*</span>— The House passed a bill Thursday to provide<span style="color: Red;">*</span>$622 billion in tax breaks for businesses, families<span style="color: Red;">*</span>and individual taxpayers.
House members voted 318-109<span style="color: Red;">*</span>to approve the legislation, which includes a permanent extension of the child tax credit and a delay in taxes that help pay for Obamacare. All but a handful of Republicans voted for the bill while a majority of Democrats voted against it. However, more<span style="color: Red;">*</span>than 70 Democrats joined with Republicans to approve the legislation.
Passage of the tax bill was the first step in approving a<span style="color: Red;">*</span>massive tax and spending deal. The second part of that agreement<span style="color: Red;">*</span>— a $1.1 trillion spending bill that funds federal agencies through September<span style="color: Red;">*</span>— is expected to be approved by both the House and Senate on Friday.
The tax and spending package is the last major legislation that Congress will pass before it adjourns for the year. It was the first big budget compromise negotiated under<span style="color: Red;">*</span>new House Speaker Paul Ryan, R-Wis.
Supporters of the tax bill said it would<span style="color: Red;">*</span>help create jobs and boost the economy.
"Families and businesses are going to have the long-term certainty they need instead of scrambling year to year to find out what's next," Ryan said.
Opponents said the bill<span style="color: Red;">*</span>would explode the deficit and leave Congress with less money in the future<span style="color: Red;">*</span>to pay for important domestic programs.
Minority Leader Nancy Pelosi, D-Calif., said she likes some of the tax breaks in the bill but objects to the fact that they are not paid for with budget cuts or increased revenue.
"It is the unpaid-for part of it that is mortgaging<span style="color: Red;">*</span>our children's future," Pelosi said. "I know it sounds good, but it's a Trojan horse."
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Congress to vote on $1.1 trillion spending plus $629 billion in tax cuts
Among the permanent tax breaks included in the bill are a<span style="color: Red;">*</span>Child Tax Credit of $1,000 per qualifying child, a<span style="color: Red;">*</span>tax credit for business research and development costs for<span style="color: Red;">*</span>start-up businesses as well as established companies, expanded tax credits for college expenses, and expanded tax credits for certain<span style="color: Red;">*</span>charitable donations by corporations<span style="color: Red;">*</span>and individuals.
The legislation also permanently extends the Earned Income Tax Credit for low-income workers<span style="color: Red;">*</span>and allows teachers to deduct up to<span style="color: Red;">*</span>$250 a year in personal expenses from their tax returns.
The bill delays or suspends some of the taxes that help pay for the Affordable Care Act, better known as Obamacare. It would suspend<span style="color: Red;">*</span>for two years<span style="color: Red;">*</span>a tax on medical device manufacturers and delay for two years the "Cadillac tax"<span style="color: Red;">*</span>— a tax on expensive employer-sponsored health coverage.
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