Washington, D.C. – U.S. Rep. Ed Perlmutter (CO-07) issued the following statement after voting against S. 2155, the Economic Growt...READ MORE
How Colorado lawmakers voted on the federal tax overhaul — and why
GOP has been under pressure from donors and their base to deliver a tax overhaul
WASHINGTON — Colorado’s five congressional Republicans joined with most of their GOP colleagues this week to pass a sweeping overhaul of the tax code that lowers rates for corporations and repeals a central pillar of the Affordable Care Act.
Republican U.S. Sen. Cory Gardner helped his party narrowly approve the measure 51-48 early Wednesday in the upper chamber while U.S. Reps. Ken Buck, Mike Coffman, Doug Lamborn and Scott Tipton were part of a 227-203 House vote on Tuesday in favor of the bill.
“I think it’s great for Colorado,” Coffman said. “It’s going to grow the economy. It’s going to increase wages as well as new economic opportunities.”
Not a single congressional Democrat backed the measure, including Colorado’s U.S. Sen. Michael Bennet and U.S. Reps. Diana DeGette, Ed Perlmutter and Jared Polis.
“The biggest problem is that it benefits corporations and the top 1 percent over the middle class,” DeGette said.
Normally the two votes would be enough to send the measure to President Donald Trump for his signature.
But after the House cleared the bill midday Tuesday, it was found to be in violation of Senate budget rules – meaning the House had to vote again Wednesday after lawmakers made a few small tweaks to the 1,000-plus-page tax plan.
The House re-vote didn’t derail the bill and it only delayed what Republicans are calling their signature legislative win for 2017.
The GOP has been under pressure from donors and their base to deliver a tax overhaul after the Republican-controlled Congress failed this summer to repeal the Affordable Care Act.
“After 31 years, the American people will no longer be forced to deal with an Atari-era tax code that is outdated and overly complicated,” said Gardner in a statement. “Congress has finally answered the call to cut taxes and reform the tax code, and I’m proud to help deliver this relief to all of Colorado.”
The tax measure, which has flown through both houses of Congress in recent weeks, has attracted widespread opposition for the tax breaks it provides to corporations and the wealthy, as well as the $1 trillion it’s expected to add to the federal deficit.
Republicans are “making a decision to borrow money from the American people to finance tax cuts for the wealthiest people in America,” Bennet said. “Yes, there are some crumbs that people in the middle class and below will see early on in tax years … but those go away over time whereas the tax cuts for corporations are permanent.”
Its Republican authors and their supporters counter that the measure would make the U.S. business environment more competitive with overseas markets.
Among other provisions, the bill:
• Lowers the corporate tax rate from 35 percent to 21 percent.
• Doubles the standard deduction, from $6,350 and $12,700 for individuals. Coupled with other changes, this move will give Americans less incentive to itemize their tax returns.
• Eliminates a fine on Americans who don’t buy health insurance, a provision of the Affordable Care Act, or Obamacare. The levy is intended to encourage healthier people to buy insurance with the aim of lowering costs for the entire insurance pool, but it long has been opposed by Republicans.
• Sets new tax brackets at 10 percent, 12 percent, 22 percent, 24 percent, 32 percent and 35 percent; a reduction for most. The new rate for the highest earners is 37 percent, down from 39.6 percent.
• Reduces taxes on inheritances. Currently, levies are applied to estates worth more than $5.5 million, or $11 million if it goes to a spouse. This bill doubles those limits.
In particular, Democrats have raised concern about the elimination of the fine on Americans who don’t purchase health insurance. The Congressional Budget Office has estimated that it would cause to 13 million more Americans to go without health insurance by 2027. That includes an estimated 235,000 Coloradans.
“Those effects would occur mainly because healthier people would be less likely to obtain insurance and because, especially in the nongroup market, the resulting increases in premiums would cause more people to not purchase insurance,” noted the CBO, which provides independent budget analysis for Congress.
Said DeGette: “13 million people – including tens of thousands of Coloradans – are going to lose their health insurance and virtually everybody else is going to see their health insurance increase in cost.”
Coffman said previously that he wanted Congress to deal with the Affordable Care Act in separate legislation — and not the tax bill. But he said Tuesday that he was persuaded to support this path because the bill wouldn’t repeal the Obamacare fine until 2019, which gives lawmakers a year to come up with a fix.
“It gives us time to work on a bipartisan replacement for that particular provision,” Coffman said.
A few provisions would have an outsized impact on Colorado.
The bill includes new tax breaks for beer makers – especially the microbreweries that are popular across the state.
“The craft beer industry gets a particular boost under this legislation,” Lamborn said.
And the bill’s deficit spending has raised concern that millions of dollars in energy royalties paid to Colorado could be in danger.
To help deal with the projected deficit caused by the bill, Trump and Republican lawmakers said they plan next year to tackle what they’re calling welfare reform or entitlement reform – or changes to programs such as Medicaid, Medicare and Social Security.
“I think there will be welfare reform irrespective of what happens to the economy,” Coffman said.
That effort is sure to trigger a new round of fighting on Capitol Hill and raise the stakes for both parties headed into the 2018 election.
“The Republicans have not been able to do anything substantial this year expect for pass tax cuts for the wealthy,” DeGette said. “And we intend to spend the next 11 months reminding the American public of that.”
Here are what some of Colorado’s other lawmakers said about the bill:
Buck: “Today, I voted for a tax reform bill that makes the tax code simpler and fairer for American families, that encourages companies to keep jobs in America through a more equitable business tax rate, and that offers lower taxes for Americans.”
Polis: “The Republican tax scheme grows the national debt by over $1.5 trillion, providing handouts to corporations and special interests while hitting middle class families with tax hikes. It serves only to weaken the nation’s economy at a time when many are still trying to get ahead after the Great Recession.”
Perlmutter: “This bill may save a few hundred dollars per person on their tax bill, but it will put more than $7,100 on the credit card for every man, woman and child in the U.S. which will lead to deep spending cuts on important programs like Medicare and Medicaid and jeopardize investments in infrastructure, education, healthcare, science and much more.”
Tipton: “The final legislation incorporates much of the feedback I heard from my constituents: it supports families, graduate students, homeowners, and small businesses. It’s a victory for Coloradans and all Americans.”Content originally published by The Denver Post on December 20, 2017.