As the last session of the 117th Congress winds down, members are rushing to find common ground on tax-and spending priorities, including ones that have implications for the functioning of government, the Washington Post reported.
While Democrats want to expand the child tax credit and Republicans hope to preserve tax breaks that benefit businesses, the government may run out of money and shut down after Dec. 16 unless lawmakers—once again—adopt a continuing resolution, keeps federal spending at current levels for a set period.
Both sides have said that a fuller appropriations package that finances the government at new levels through the fiscal year that ends on Sept. 30, 2023 would be preferable.
“You either want to have an omnibus and move forward with everything in it, or you don’t,” said Rep. Rosa L. DeLauro (D-Conn.), chair of the House Appropriations Committee. “This is a reality that has serious consequences for the American people.”
Such an omnibus bill could include some key policy priorities for each side, such as Democrats’ desire to extend the child tax credit and Republicans’ wish to preserve parts of the Tax Cuts and Jobs Act (TCJA) of 2017. In the absence of a comprehensive agreement, those priorities may have to wait until the next Congress.
Republicans want to change rules that took effect this year that would allow businesses to deduct certain research-and- development expenses immediately to reduce their taxable income. The changes were mandated by the TCJA to help offset the fiscal costs of the law’s corporate rate cut.
Bipartisan support for returning to this immediate deductibility for R&D expenses exists. Democrats would like to see it linked to the tax credit, which lapsed last year, but Republicans want to add a work requirement and target the aid more narrowly.
Other issues include tens of billions of dollars for such programs as aid to Ukraine, coronavirus prevention and natural disaster relief.
Overshadowing all of this is the Republican majority that will take over the House of Representatives when the new Congress is seated in January. Sen. Rick Scott (R-Fla.) wants to pass only a short-term funding measure until “some time into the next Congress, and let the next Congress do their job.” Minority Leader Kevin McCarthy (R-Calif.), the prospective speaker of the House, told Fox News, “Why would you want to work on anything if we have the gavel inside Congress?”