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U.S. Sen. Mike Lee of Utah
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As tax reform vote looms, Senators Rubio, Lee fight for improved child tax credit

Doug Mainwaring Doug Mainwaring Follow Doug

WASHINGTON, D.C., November 30, 2017 (LifeSiteNews) – Important family-centric legislation has been introduced by U.S. Senators Marco Rubio of Florida and Mike Lee of Utah during the final hours of debate before the Senate votes on Capitol Hill’s first meaningful tax reform in decades.  

The U.S. House of Representatives has already passed a bill that includes a raise in the Child Tax Credit (CTC) from its current level of $1,000 to $1,600.  

The Rubio-Lee Amendment proposes two important changes to the House tax reform package. First, it would raise the CTC to $2,000. Second, and perhaps far more important to many families of more modest means, the CTC would be refundable not just against income taxes but also against payroll taxes.

This would be an enormous boon to low income families who don’t earn enough money to fully benefit from an increased CTC.

“We have a chance to do better by working families in this tax bill,” explained Senator Lee in a statement. “Right now, 70 percent of the tax cuts we’re considering would go to businesses, and only 30 percent to individuals. This amendment would level the playing field for families while still kick-starting national investment and growth. By increasing access to the Child Tax Credit, we can increase working family fairness and deliver overdue relief to America’s greatest investor class: our moms and dads.”

White House opposition to the method of offset

Because the Rubio/Lee Amendment seeks to set the revised corporate tax rate to 22 percent instead of 20 percent in order to offset lost revenue to government coffers, it has met with opposition from the White House. The Trump administration wants to keep the new corporate tax credit at 20 percent, down from its current level of 35 percent, in order to spark corporate expansion and also to make it attractive for corporations to repatriate up to $2.5 trillion in profits now held overseas.  

The White House is not at odds with Senators Lee and Rubio over the substance of their amendment; the issue at hand is the method of financing the CTC. In order for the Senate to pass this legislation with a simple majority vote -- which requires no support from Senate Democrats -- any loss of revenue to the government must be made up for somewhere else in the reform legislation. The 2 percent raise in the proposed corporate tax rate is the method that Rubio and Lee chose.

White House deputy press secretary Raj Shah explained that while the administration continues to support the increased CTC, “We also think that it’s important to make businesses more competitive," Shah told reporters traveling with Trump aboard Air Force One. "We would not support raising the corporate rate as outlined in that amendment.”

In response to expressed White House opposition, and the lack of public support for the Rubio-Lee Amendment by many conservatives, The New York Times’ Ross Douthat tweeted a long rant, culminating with: “And I want them to wonder, while Mike Lee and Marco Rubio fight a lonely battle for a *pittance* of a refundable tax credit for American families IN THE MIDST OF A BABY BUST, why nobody in professional Populist Conservatism seems interested in making this a cause celebre.” He continued, “I'd like to wake up tomorrow and find everyone from Steve Bannon to Tucker Carlson publicly hammering the president and the party on this issue. That would be nice. But assuming they don't, this thread is my way of saying to professional Populist Conservatism, to hell with you.”

The Rubio-Lee Amendment adheres to White House desired CTC improvements

The CTC amendment proposed by Senators Rubio and Lee is in keeping with policy previously outlined by the White House. In September, Ivanka Trump told pro-family activists, “This administration is pushing for the largest child tax credit possible” and “would also like to see it be made refundable against payroll taxes, so that more lower income families can fully benefit from the credit.”  

At that same meeting, the American Enterprise Institute’s Michael Strain explained that applying the child tax credit to payroll taxes is “a very important policy innovation that will help people who really do need help, people who are not making six-figure incomes and who are really solidly in the working class,” adding, “there’s quite a bit to be said about having a larger child credit in the year that your child is born.”

Former Pennsylvania Senator Rick Santorum, also present at the meeting, echoed Ivanka Trump’s message, passionately voicing the populist sentiment brewing throughout the country, “The tax code screws families.” The American family is “the ultimate small business in America, and yet it gets nothing from the federal tax code, except a few pennies.”

“Look at the American family for what it really is: A small business with income, expenditures, and operational costs,” said Santorum. The American family’s product is children and it invests capital in developing those children. As a business, the family would write off its ‘investment’ put into raising kids. “(E)xpenses every year — would be a ‘cost of production.’ But in the American tax code it is completely ignored. You can write off none of that.”

The vote

The Senate is currently in the middle of debating its tax reform legislation, with Democrats and Republicans evenly splitting 20 hours of floor time. A vote on the legislation is expected either late today or early Friday.  

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