US Senate passes major tax cut and reform bill

The US Senate has approved a major overhaul of the country’s tax system, the largest in more than three decades.

The House of Representatives earlier approved the bill comfortably. Republicans have majorities in both houses of Congress.

For final approval the legislation must go back to the House on Wednesday for a procedural issue.

If it passes, as expected, it will be President Donald Trump’s first major legislative triumph.

Trump tweeted this morning: “The United States Senate just passed the biggest in history Tax Cut and Reform Bill. Terrible Individual Mandate (ObamaCare)Repealed. Goes to the House tomorrow morning for final vote. If approved, there will be a News Conference at The White House at approximately 1:00 P.M”

The bill permanently cuts the tax rate for corporations from 35% to 21% and also lowers individual tax rates, albeit temporarily.

Other key elements include:

  • Less inheritance tax
  • An expanded child tax credit
  • Lower taxes on overseas profits

However, the non-partisan Joint Committee on Taxation says the legislation will add as much as $1.4tn to the $20tn national debt over 10 years.

Vice-President Mike Pence presided over the vote and announced the result.

“On this vote the ayes are 51, the nays are 48. The Tax Cuts and Jobs Act is passed,” he said.

Due to a procedural glitch, the House will have to vote again on Wednesday morning before the bill can be signed into law by President Trump.

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