(Bloomberg) -- Republican Senator Marco Rubio of Florida criticized his party for considering a cut in the top individual tax rate to 37 percent as part of its tax-overhaul plan -- while setting the proposed corporate rate slightly higher than planned to cover the revenue loss.
Although both the House and Senate have approved measures cutting the corporate rate to 20 percent from 35 percent, a flurry of negotiations Tuesday centered on setting the rate at 21 percent -- while trimming the top individual rate. The situation remained fluid Tuesday night.
Rubio, along with Republican Senator Mike Lee of Utah, had proposed expanding the child tax credit earlier this month. They said Congress could pay for that change by setting the corporate tax rate at 20.94 percent rather than 20 percent. The amendment was defeated by a vote of 71 to 29 a couple of hours before Republicans approved their version of the tax bill on Dec. 2.
“20.94% Corp. rate to pay for tax cut for working family making $40k was anti-growth but 21% to cut tax for couples making $1 million is fine?” Rubio said in a Twitter message Tuesday.
Rubio's proposal would have made the credit refundable against payroll taxes, as a way to help struggling Americans.
Earlier this week, Grover Norquist of Americans For Tax Reform slammed Rubio for suggesting the roughly 1 point increase in order to finance the larger child tax credit.
“What Rubio was doing is channeling his inner George H.W. Bush,” Norquist said at the time, referring to the former Republican president who raised taxes in 1990 to help reduce the deficit. “When you open the door to raising a rate you're not the only guy who gets to walk through," Norquist said, arguing that future congresses and presidents would seek to raise the rate if the party signals openness to it.
To contact the reporter on this story: Alexis Leondis in Washington at aleondis@bloomberg.net.
To contact the editor responsible for this story: John Voskuhl at jvoskuhl@bloomberg.net.
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