Trump promises Americans ‘huge tax cut’ for Christmas

President Donald Trump announces that the United States will designate North Korea a state sponsor of terrorism during a cabinet meeting at the White House, Monday, Nov. 20, 2017, in Washington. (AP Photo/Evan Vucci)

WASHINGTON (AP) — President Donald Trump on Monday promised a tax overhaul by Christmas, a day after the White House signaled its willingness to strike a health care provision from Senate tax legislation if it’s an impediment to passing the tax bill.

Speaking before a Cabinet meeting, Trump said, “We’re going to give the American people a huge tax cut for Christmas — hopefully that will be a great big, beautiful Christmas present.”

At issue is a provision that would repeal a requirement that Americans have health insurance or pay a fine. The provision is not in the version of the tax overhaul passed last week by the House. It is in the bill the Senate Finance Committee has approved.

Repealing a central mandate of the Obama health law has emerged as a major sticking point for Republican Sen. Susan Collins of Maine, whose vote the White House needs. Collins said Sunday that the issue should be dealt with separately.

Striking the health care provision would blow a big hole in the senators’ tax cut plan, leaving them $338 billion short of their revenue goal over the next 10 years.

Senators would have to find the money elsewhere to meet the revenue goal mandated by the budget resolution passed by the Senate and House earlier this year. But so far, there is no consensus among senators on how to come up with the money.

Trump’s budget director, Mick Mulvaney, said the White House is open to scrapping the provision, which would repeal a key component of the health care law enacted by President Barack Obama. Trump had pressed for the provision to be added to the bill, partly to show progress on the GOP goal of undoing the health care law following Congress’ failed attempts to repeal it earlier this year.

“I don’t think anybody doubts where the White House is on repealing and replacing Obamacare. We absolutely want to do it,” Mulvaney said Sunday. “If we can repeal part of Obamacare as part of a tax bill and have a tax bill that is still a good tax bill that can pass, that’s great.

“If it becomes an impediment to getting the best tax bill we can, then we’re OK with taking it out,” Mulvaney added.

Trump did not directly address the issue Monday. He said that the administration would focus on health care, infrastructure and welfare “soon after taxes.”

Legislative director Marc Short said Sunday that the White House “is very comfortable with the House bill,” which does not include the individual mandate. But Short also said the White House views the mandate as a tax and “we like the fact that the Senate has included it in its bill.”

Collins said Sunday that the tax advantage that some middle-income consumers would reap under the tax bill could be wiped out by repealing the mandate under the Affordable Care Act. She said they would face higher insurance premiums coupled with the loss of federal subsidies to help them afford coverage.

“The fact is that if you do pull this piece of the Affordable Care Act out, for some middle-income families, the increased premium is going to cancel out the tax cut that they would get,” Collins said.

Collins said she hasn’t decided how to vote on the bill because it will be amended before it reaches the Senate floor. But her vote is crucial in a chamber where Republicans hold a slim 52-48 advantage.

Last week, Sen. Ron Johnson of Wisconsin became the first Republican to declare opposition, saying the plan wouldn’t cut business taxes enough for partnerships and corporations. GOP Sens. Bob Corker of Tennessee, John McCain and Jeff Flake of Arizona, and Rand Paul of Kentucky have also expressed concerns.

Republicans can lose just two senators on the final vote, which would allow Vice President Mike Pence to cast a tie-breaking 51st vote in his capacity as president of the Senate. Democrats are not expected to support the bill, as was the case when the House passed its version last week.

Treasury Secretary Steven Mnuchin said the mandate amounts to “an unfair tax on poor people.”

“The president thinks we should get rid of it. I think we should get rid of it,” he said, but added: “We’re going to work with the Senate as we go through this.”

Mulvaney and Collins were interviewed on CNN’s “State of the Union.” Mnuchin spoke on “Fox News Sunday.” Collins also appeared on ABC’s “This Week,” as did Short.

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