By Jessica Domel
Multimedia Reporter
Cheers were heard across the floor of the U.S. House of Representatives Thursday as Republicans garnered more than enough votes to pass its tax reform legislation, the Tax Cuts and Jobs Act.
Two representatives did not vote, 227 voted in favor of the act and 205 voted against it.
Thirteen House Republicans and all Democrats opposed the bill, CNN reports.
The act calls for sweeping changes to the American tax code for the first time in more than three decades.
“Today’s passage of the Tax Cuts and Jobs Act (HR 1) by the House of Representatives puts us one step closer to a tax code that works for all farmers and ranchers,” American Farm Bureau Federation (AFBF) President Zippy Duvall said. “Lower rates combined with the preservation of small business expensing, like-kind exchanges and the business deduction for state and local taxes are just a few of the things we are pleased to see in this legislation. We look forward to working with the Senate to build on this success in the coming weeks.”
Under HR 1, death tax exemptions would double with a full repeal of the tax scheduled in seven years.
The bill would also allow businesses, including farmers and ranchers, to immediately write-off the full cost of new equipment, according to the House Ways and Means Committee.
“This is a historic moment for the American people,” Congressman Kevin Brady of Texas, chair of the House Ways and Means Committee, said. “Today (Thursday, Nov. 16) we give hope to middle-income families and Main Street job creators in Texas and across the country that a brighter future is on the horizon– a future where you can keep more of what you earn, start that new business, find that next job, and get that long-overdue raise.”
The Tax Cuts and Jobs Act will deliver tax relief by lowering individual tax rates for low and middle-income families to zero, 12 percent, 25 percent and 35 percent, Brady reports. A 39.6 percent tax rate will be maintained for high-income Americans.
“This vote is a big step forward, but it is not the last step,” Brady said. “We will continue to strengthen this legislation and, working with the Senate, we will put tax reform on the president’s desk by the end of the year for the first time in 31 years.”
Under the plan, the standard deduction for an individual would increase from $6,350 to $12,000. The deduction for married couples would increase from $12,700 to $24,000.
“We seized the opportunity of a lifetime to shed the status quo and transform our tax code to work for middle-income families and small businesses,” Congressman Peter Roskam of Illinois, chairman of the Ways and Means Subcommittee on Oversight, said. “There is more work to do but I’m pleased with our progress to bring tax relief to the hardworking families in my district and across the country. This new tax code is forward leaning and designed to make our economy boom again.”
HR 1 preserves the home mortgage deduction for existing mortgages and maintains the deduction for newly-purchased homes to up $500,000.
According to Brady, the Alternative Minimum Tax would be repealed along with other special deductions that complicate the tax process.
A new family credit, which includes expanding the Child Tax Credit, would remain along with the Adoption Tax Credit and the Child and Dependent Care Tax Credit.
The Senate’s plan for tax reform is currently in committee.
If the Senate bill passes, the two chamber’s bills will be conferenced together and sent to the president for his consideration.
GOP leaders report they hope to have legislation on President Trump’s desk by Christmas.