GOP near agreement on tax bill

WASHINGTON — Republican lawmakers, scrambling to reach agreement on a final tax bill that they hope to pass next week, are coalescing around a plan that would slightly raise the proposed corporate tax rate, lower the top rate on the richest Americans and scale back the existing mortgage interest deduction.

In a frenzy of last-minute negotiations, Republicans drew closer to agreement on nudging the corporate tax rate to 21 percent, up from the 20 percent in the bills that passed the House and Senate but still lower than the current 35 percent corporate rate, according to a lawmaker and a person briefed on the discussions.

They are also considering lowering the top individual tax rate to 37 percent, from the current top rate of 39.6 percent, to assuage concerns from some wealthy taxpayers who fear that their tax bills could rise under the current legislation, which eliminates a host of individual tax breaks.

Another closely watched change centers on the ability to deduct the interest on mortgage debt. Lawmakers are discussing limiting the deduction to mortgage debt of up to $750,000 for newly purchased homes, lower than the $1 million limit that currently exists and remains in the Senate-passed bill, according to Sen. John Kennedy, R-La.

In a sign of how difficult it is to build consensus for such a fast-moving bill, Sen. Susan Collins, R-Maine, said Tuesday that she did not like the idea of lowering the top individual rate, which is currently 38.5 percent in the Senate bill and 39.6 percent in the House version.

“I don’t think lowering the top rate is a good idea,” Collins said, explaining that she preferred the House version that did not lower the top tax rate. However, Collins, who negotiated several changes to the final version of the Senate tax bill in exchange for her vote, would not say whether the adjustment to the top rate was a deal breaker.

“I’m going to wait and look at the entire conference report and what all of the provisions are,” Collins said.

The bipartisan conference committee is scheduled to hold its one public meeting Wednesday. While that meeting will give Republicans and Democrats a final chance to publicly debate the merits of a $1.5 trillion tax cut, it is not expected to alter the trajectory of the bill.

A spokeswoman for the Senate Finance Committee stressed late Tuesday afternoon that negotiations were still continuing, but many lobbyists said they expected the discussions to be complete before the public meeting on Wednesday begins.

House and Senate Republicans have been working behind closed doors to hash out the final details of the tax plan, and they hope to hold a vote next week.