(Bloomberg) -- Senate Republicans stopped a $78 billion package of tax cuts benefiting businesses and low-income families, two constituencies the party needs to win big in November.
Democrats, who will return home to campaign later this week, now plan to paint Republicans as the party that blocked a pro-family tax cut they estimate would benefit 16 million children and benefit struggling small businesses.
“This should be a no-brainer. Even House Republicans are for this,” Senate Majority Leader Chuck Schumer said.
Democrats couldn’t muster the 60 votes needed to overcome a filibuster blocking the Senate from consideration. The procedural step received 48 votes in favor and 44 against.
Only three Republicans voted in support: Josh Hawley of Missouri, Markwayne Mullin of Oklahoma and Rick Scott of Florida.
Several senators were absent, including Ohio Senator JD Vance, the Republican vice presidential candidate, who has previously said he favors an expanded child tax credit. Vance was on a campaign trip to Arizona.
The tax package, which passed the House on a 357 to 70 vote in January, would have provided a boon for US companies with large capital and domestic research expenditures and had been a top priority of business lobbyists.
Boeing Co., General Motors Co., Deere & Co., Caterpillar Inc., Amazon.com Inc., Microsoft Corp. and Apple Inc. are among the companies that would have benefited, according to Bloomberg Intelligence.
North Dakota’s Kevin Cramer said Schumer made a “cynical ploy” to hold the vote rather than allow amendments. Texas Republican John Cornyn said the vote was “not an honest attempt to pass legislation.”
Schumer told reporters he’d consider allowing amendments, but not until after the monthlong break.
“They are going to feel a lot of pressure over August recess, and we hope they will come back and change their mind in September,” he said of Republicans.
Others, including top Republican tax-writer Mike Crapo, have said they want to wait until next year, when the 2017 Trump tax cuts expire and they hope Republicans will control the Senate and White House.
Other Republicans have signaled they don’t want to hand Democrats a victory so close to the election. The Internal Revenue Service had said it could send refund checks to families benefiting from the break within six weeks of the bill being enacted.
The bill allows more of the $2,000 per child tax credit to be paid to individuals with such low income they currently only qualify for part of the credit. It would also bolster payments to low-income filers with more than one child. The maximum credit for all parents would be indexed to inflation for two years starting in 2024.
Some conservatives argued that a provision allowing parents to claim credits based on a prior year’s earnings would discourage work. Senate Finance Committee Chair Ron Wyden, the bill’s Democratic author, said he offered to remove that provision but that prompted more demands from Republicans.
A coalition of 250 business groups including the US Chamber of Commerce, Business Roundtable and National Association of Manufacturers lobbied hard for passage this year.
Wyden said the GOP move bodes ill for a grand bargain on the Trump tax cuts next year, saying such deals don’t just happen by “osmosis” and will require the kind of bipartisan dealmaking the Senate Republicans rejected.
--With assistance from Chris Cioffi.
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