Senate Rejects Bipartisan Bill on Tax Breaks and Child Tax Credit Expansion
The Senate voted against a significant bill on Thursday aimed at reinstating expired tax incentives for businesses and broadening the child tax credit. Many Republican senators opposed the bipartisan proposal, hoping to gain leverage for larger tax reforms anticipated for the following year.
This comprehensive legislation, estimated at around $80 billion, initially appeared to have strong support. It successfully passed through the House earlier this year, garnering widespread bipartisan backing—a rare achievement in today’s political climate. Business organizations expressed enthusiasm, hoping Congress would permit firms to fully deduct the costs of capital investments and research expenses from their taxable income. Simultaneously, advocates for anti-poverty measures welcomed the proposed enhancements to federal assistance for families with children.
However, the initiative—led by Representative Jason Smith, a Republican from Missouri and chairman of the Ways and Means Committee, alongside Senator Ron Wyden, a Democrat from Oregon and chairman of the Finance Committee—ultimately stalled in the Senate. Republican senators raised concerns that the bill’s expansion of the child tax credit could resemble the establishment of a new welfare program, complicating the legislation’s progress.
Despite the bill’s fate being seemingly doomed due to Republican opposition, Senator Chuck Schumer, the New York Democrat and majority leader, proceeded to bring it to a procedural vote on Thursday. The outcome was a failure, with a tally of 48 in favor and 44 against, falling short of the 60 votes necessary to advance. While three Republicans sided with the Democrats in support of the bill, two independents who align with Democrats—Senator Joe Manchin III of West Virginia and Senator Bernie Sanders of Vermont—voted against it. Notably, Senator Schumer also voted against the bill, a strategic move that leaves the door open for a possible future vote.
In light of the procedural vote, prominent Democrats viewed this as an opportunity to gain political traction ahead of the upcoming election year. They criticized Republicans for their opposition to measures that would enhance access to the child tax credit for low-income families and increase its value for parents with multiple children.
Additionally, Senator JD Vance, a Republican from Ohio and the party’s vice-presidential nominee, has faced backlash for previous remarks disparaging “childless cat ladies.” While Senator Vance has retracted some of his statements, he continues to assert that Democrats have enacted policies detrimental to family well-being.
