The House of Representatives has passed the final version of the Tax Cuts and Jobs Act, sending the first overhaul to the U.S. tax code in 31 years to President Donald Trump for his signature.
The House had to revote on a measure after Democrats pushed the parliamentarian to flag a few provisions in the U.S. Senate, including expanding popular 529 college savings plans.
“After years of work, we are going to enact the most sweeping, pro-growth overhaul of our tax code in a generation,” House Speaker Paul Ryan, R-Wis., said. “Americans are going to see relief almost immediately in the form of bigger paychecks and lower taxes.”
As with the previous vote in the House on Tuesday, not a single Democrat supported the bill and 12 Blue State Republicans defected. They objected to the elimination of the state and local tax deductions, known as SALT, because they represent high-tax states like California, New York and New Jersey.
Republican lawmakers from both the House and Senate are gearing up to head over to the White House for a celebration gathering. The passage of the Tax Cuts and Jobs Act marks the first major legislative achievement for the Trump Administration and the fulfillment of a major campaign promise.
“We’re getting from what is really, arguably, the worst tax system in the world to one of the best tax systems in the world,” Speaker Paul added. “It’s going to put the American economy in the lead in the global economy again.”
The tax reform overhaul slashes the U.S. corporate tax rate from 35% to 21%. It imposes a $10,000 cap on state and local taxes deductions and mostly repeals the death tax. The final version of the bill also repealed the individual mandate established by ObamaCare.
“Come February, check your check,” House Majority Leader Kevin McCarthy, R-Calif., said. “Because you’re getting a raise.”
Speaker Ryan said the Republican conference has every intention of pushing for the individual tax cuts to be permanent. The 10-year sunset provision was added to avoid parliamentarian rules that require a 60-vote threshold for passage in the U.S. Senate.
Check out how the tax reform overhaul impacts you with the tax plan calculator.