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Elizabeth Warren

Senate wants its say on the Smith-Wyden tax deal

The Senate is looking to pump the brakes on the bicameral, bipartisan bill that tax writers unveiled earlier this month.

Senate Republicans — and even one key Democrat — told us they want to hold a committee markup on the bill. That would slow down the nearly $80 billion package.

Backers of the deal want to get it done quickly and believe they need it to pass in February to avoid trouble during tax filing season. A markup could slow the process down or kill it altogether.

The top Republican on the Senate Finance Committee, Idaho Sen. Mike Crapo, has been in no rush to embrace the compromise. Crapo pointed to issues with the child tax credit expansion as a hangup.

Senate Minority Whip John Thune, a member of the panel, said he wanted a markup to try to change some of the child tax credit provisions due to concerns about keeping it tied to earnings and work.

Sen. John Cornyn (R-Texas), another member of the powerful panel, said this is why he wants a markup: “I want to get back to legislating. We can’t just have a deal between two people and then just say ‘Take it or leave it.’”

Chipping away at the child tax credit expansion would almost certainly rankle Democrats. They have made it clear that extending it for low-income families is their overwhelming priority. And the cost is meant to balance roughly with business tax benefits.

Also likely to come up, the Joint Committee on Taxation is out with its macroeconomic analysis, which found the bill wouldn’t have a significant impact on labor supply.

On the Dem side: Sen. Elizabeth Warren (D-Mass.), who sits on the Finance panel, wants a markup too. Warren’s remarks might be the most striking and represent the partisan divisions a committee vote could exacerbate:

Keep in mind, this hasn’t totally gotten real in the Senate yet. Senators are watching what the House does, and backers are optimistic that a big vote there could shift the Senate’s mood. There’s also plenty of outside pressure from the business community.

The House Republican leadership is engaged in a vigorous and seemingly endless debate over whether to take up the package next week.

Some in the GOP leadership want to move quickly, using the fast-track suspension process to get it through the chamber. New York Republicans, however, are banging on Speaker Mike Johnson to allow them to amend the bill to modestly roll back the limit on state and local tax deductions.

Senate Finance Committee Chair Ron Wyden (D-Ore.) said he’s watching “two big ifs” — if Johnson gives it a vote and the tally.

“If those two ifs are realized — if it comes up, if it gets a big vote — this does not become a traditional political Ds and Rs kind of debate,” Wyden said.

At least that’s what Wyden hopes.

— Jake Sherman and Laura Weiss

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