The House approved a nearly $700 billion tax cut package Thursday and prepared to vote on a trillion-dollar spending plan to round out the year’s business, despite grumbling from some lawmakers and fiscal watchdogs over the impact to the deficit.
The so-called “tax extenders” bill passed on a 318-109 vote.
The legislation, together with a spending bill set for a vote Friday, stands as House Speaker Paul Ryan’s first big budget test since taking the gavel. While the process has gone more smoothly than some of his predecessor’s budget battles, Ryan faced consternation from both sides of the aisle over the package.
Democrats were disappointed they were unable to extract more concessions during the process, particularly after Republicans won a long-sought measure to lift the oil export ban in the spending bill. And most Democrats opposed the tax package, complaining it would worsen federal deficits and make it harder to find money for domestic programs they favor.
But conservatives had their own set of complaints.
While many Republicans back extending key tax breaks, some were uneasy over the sheer size of the tax-and-spending package. Some were angry over the number of riders attached, and others were angry that certain riders weren’t attached – specifically to defund Planned Parenthood and tighten Syrian refugee screening.
And on the sidelines, fiscal watchdog groups were furious over the impact to the deficit.
“This bill would dramatically grow the size of government while failing to cut spending in any meaningful way,” Diana Banister, director of Citizens for the Republic, said in a statement. The conservative group ripped both pieces of legislation, including provisions to extend solar and wind energy subsidies.
The conservative Club for Growth further complained the package to be voted on Friday would “be like a Christmas tree, filled with gifts to both parties.”
Some uncertainty arose Thursday over the separate spending measure as House Minority Leader Nancy Pelosi, D-Calif., suggested there might not be enough Democratic votes to push it through the chamber. The companion spending bill would provide $1.1 trillion to finance government in 2016, leaving only Senate action should it pass before the 2,200-page bundle goes to President Obama.
The tax bill, meanwhile, would mostly renew scores of existing breaks that have lapsed or are about to, but its scope included victories for both parties.
Tax credits for college expenses, child costs and lower-earning families are set to become permanent, as would cuts for companies that do research or buy equipment. The measure would make permanent or at least extend reductions for some charitable contributions, builders of energy-efficient homes, producers of Puerto Rican and Virgin Islands rum and owners of auto race tracks.
Coupled with tax provisions that House leaders stuffed into the spending bill to attract votes, the legislation would cost the government an estimated $680 billion over the next decade. That would pump federal deficits over that period, already projected to total an astronomical $7 trillion, even higher.
The liberal-leaning Citizens for Tax Justice said in a statement that the package is only increasing the “budget hole” and “would lose more revenue than was ‘raised’ by the fiscal cliff package in 2013.”
"It's a significant tax relief measure and of course you know how Republicans like to cut taxes," Senate Majority Leader Mitch McConnell, R-Ky., told The Associated Press, defending the bill.
Speaker Ryan also responded to concerns about the process itself – lumping a hodgepodge of issues into a must-pass measure at the end of the year – during a press conference after the vote.
“You know I don’t like this process,” Ryan said, adding that he was dealing with “a cake that was pretty much half-baked” when he took over the job.
“Next year, we’re going to do things differently,” he vowed, while arguing that the package is a “bipartisan compromise.”
In a win for Republicans, tucked into the two bills were provisions delaying controversial taxes associated with ObamaCare. A tax on medical devices would be suspended for two years, a levy on health insurers would stop for one year and, in a victory for unions, a tax on higher-cost insurance policies would be postponed two years until 2020.
Republicans won an end of the four-decade ban on U.S. crude oil exports. The industry said lifting that prohibition would create jobs and lower gasoline prices -- outcomes that opponents said were wrong.
In exchange, Democrats secured extensions of tax breaks for alternative power sources such as solar and wind energy.
The spending package up for a vote Friday appeared to be causing more concern from Republicans, particularly members of the House Freedom Caucus.
Rep. Jim Jordan, R-Ohio, head of that group, told Reuters the bill has “real problems”
The Associated Press contributed to this report.