Congressional Republicans advanced two competing visions of tax reform Thursday, setting up a potentially bruising battle in the weeks ahead as they struggle to agree on a bill President Trump can sign.
With the Senate GOP’s unveiling of its tax plan, key differences with the House version became apparent. Among the biggest potential losers in both plans are residents of California and other high-cost states, who rely heavily on itemized deductions for state, local and property taxes.
The Senate plan eliminates all such state and local deductions, while the House proposal retains property tax deductions up to $10,000. As a trade-off, the Senate version would preserve other popular deductions targeted for removal in the House plan, such as for medical expenses.
Both the Senate and House plans would lower the corporate tax rate from 35% to 20%, but the House would make the cut immediately, while the Senate would delay implementation for a year, until 2019, in order to save an estimated $108 billion.
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