Sens. Marco Rubio and Mike Lee are adamant that any tax overhaul bill must benefit working families and corporations alike, and they're willing to support a smaller cut to corporate taxes in order to pay for an increased child tax credit.
President Donald Trump doesn’t like the idea.
Rubio, R-Fla., and Lee, R-Utah, announced Wednesday that they want to increase the federal corporate income tax rate to 22 percent from the 20 percent proposed in the Senate’s tax overhaul bill. The corporate tax increase would pay for a child tax credit that reduces some families’ tax bill for every child they have under the age of 17.
“We have a chance to do better by working families in this tax bill,” Rubio and Lee said in a statement. “Right now, 70 percent of the tax cuts we’re considering would go to businesses, and only 30 percent to individuals. This amendment would level the playing field for families, while still kick-starting national investment and growth. By increasing access to the Child Tax Credit, we can increase working family fairness and deliver overdue relief to America’s greatest investor class: our moms and dads.”
Rubio and Lee have repeatedly said that Republicans will pay at the ballot box if it is perceived that their tax plan doesn't do enough to help working families. The pair did get the child tax credit increased to $2,000, which is higher than the current ceiling of $1,000, but they are arguing that more must be done.
Rubio and Lee’s plan would also make the $2,000 tax credit fully refundable, meaning that if a low-income family’s tax credit exceeds their total amount owed in taxes, they would be eligible for a tax refund. The tax credit would also be tied to the rate of inflation, which means the tax credit will increase if inflation increases.
“I’m not going to vote for an increase on the middle class,” Rubio said in October. “But we’re not going to get to that point. We’re not that crazy around here.”
President Donald Trump called the proposed 20 percent corporate tax rate a “perfect number” earlier this year, though at one point he wanted an even bigger cut to 15 percent. A White House official confirmed to the Miami Herald that Trump opposes Rubio’s plan.
“We do support the child tax credit. We also think it’s important to make businesses more competitive. We would not support raising the corporate rate as outlined in that amendment,” said White House spokesman Raj Shah.