Lawmakers celebrated their legislative victory and heaped praise on Donald Trump after passing a $1.5tn tax cut which permanently slashes corporate rates

This article is more than 2 years old

This article is more than 2 years old

Jubilant Republican lawmakers joined Donald Trump at the White House for a victory celebration on Wednesday as Congress approved the party’s biggest priority, the most thorough reshaping of the American tax system since the 1980s.

Thank you, President Trump, for allowing us to have you as our president Congresswoman Diane Black

They celebrated their legislative victory and heaped praise on the president in the outdoor ceremony. After Trump inaccurately called the bill “the largest tax cut in the history of the country”, and hailed it for allowing for the “formation of new, young, beautiful, strong companies”, Republican leaders took turns praising him.

The Senate majority leader, Mitch McConnell, said this had been “a year of extraordinary accomplishment for the Trump administration” and the House speaker, Paul Ryan, praised Trump’s “exquisite presidential leadership”. Others went even further. Vice-President Mike Pence thanked Trump for his “boundless faith in the American people” while Utah senator Orrin Hatch called Trump “one heck of a leader”. Perhaps the most fervent praise came from Tennessee congresswoman Diane Black who proclaimed: “Thank you, President Trump, for allowing us to have you as our president.”

The House passed the bill by 224 to 201– repeating the previous day’s vote after making a mistake in its passage on Tuesday. Twelve Republicans voted against the plan and no Democrats supported it.

Senate approves most drastic changes to US tax code in 30 years Read more

The bill represents a $1.5tn tax cut which permanently slashes corporate tax rates and also lowers taxes for individuals.

Trump hailed the bill in a statement. “I promised the American people a big, beautiful tax cut for Christmas. With final passage of this legislation, that is exactly what they are getting … By cutting taxes and reforming the broken system, we are now pouring rocket fuel into the engine of our economy. America is back to winning again, and we’re growing like never before.”

In a cabinet meeting shortly before the House vote, Trump praised the legislation and hailed it as “essentially repealing Obamacare” in addition to what he claimed would be the economic benefits of the tax cut. “It’s about jobs,” insisted Trump. He also heralded a measure which would open up the Alaskan Arctic wilderness for oil and gas drilling by energy companies.

Pence also spoke, praising Trump for delivering “historic tax cuts … [and] that middle-class miracle”. The housing secretary, Ben Carson, also offered a prayer.

“Workers benefit. Wages go up. More jobs occur,” Ryan said Wednesday on NBC’s Today, describing what Republicans say will flow from a $1.5tn measure that affects everyone’s taxes but is dominated by breaks for business and higher earners. Democrats call the legislation a boon to the rich that leaves middle-class and working Americans behind.

“If they think this bill is a good political argument for them, let them think that,” the House minority leader, Nancy Pelosi, told reporters.

The Senate used a post-midnight vote to approve the measure on a party-line 51-48 tally. Protesters interrupted with chants of, “Kill the bill, don’t kill us” and Pence, chairing the session, repeatedly called for order. Upon passage, Republicans cheered, with the treasury secretary, Steve Mnuchin, among them.

McConnell insisted Americans would respond positively to the tax bill.

“If we can’t sell this to the American people, we ought to go into another line of work,” he said.

Trump planned a ceremony with GOP lawmakers on Wednesday at the White House after final congressional approval.

The bill will not be signed there, however. Instead, it is likely to be signed by Trump while he spends Christmas at his Mar-a-Lago resort.

The tax bill which was pushed through Congress at a breakneck pace required an extra day before it could reach Trump’s desk because of a procedural hiccup with Senate rules. This meant the House had to vote a second time on the bill once two minor offending provisions had been stripped out.

Ryan, who has worked years toward the goal of revamping the tax code, gleefully pounded the gavel on Tuesday’s House vote. GOP House members roared and applauded as they passed a package that will touch every American taxpayer and every corner of the US economy, providing steep tax cuts for businesses and the wealthy, and more modest help for middle- and low-income families.

Despite Republican talk of spending discipline, the bill is projected to push the huge national debt ever higher.

Ryan said on Wednesday the GOP was willing to risk running up deficits with the aim of getting a higher annual economic growth rate.

Trump is aching for a big political victory after 11 months of legislative failures and nonstarters. The president tweeted his congratulations to GOP leaders and to “all great House Republicans who voted in favor of cutting your taxes!”

Congressional Republicans, who faltered badly in trying to dismantle Barack Obama’s Affordable Care Act, see passage of the tax bill as crucial to proving to Americans they can govern – and imperative for holding on to House and Senate majorities in next year’s midterm elections.

“The proof will be in the paychecks,” Senator Rob Portman said during the Senate’s nighttime debate. “This is real tax relief, and it’s needed.”

Not so, said the top Senate Democrat as the long, late hours led to testy moments Tuesday night.

“We believe you are messing up America,” the New York senator Chuck Schumer told Republicans, chiding them for not listening to his remarks.

The GOP has repeatedly argued the bill will spur economic growth as corporations, flush with cash, increase wages and hire more workers. But many voters in surveys see the legislation as a boost to the wealthy, such as Trump and his family, and a minor gain at best for the middle class.

Democrats mocked the Republicans’ contention that the bill will make taxes so simple that millions can file their returns “on a postcard” – an idea repeated often by the president.

“What happened to the postcard? We’re going to have to carry around a billboard for tax simplification,” declared Representative Richard Neal of Massachusetts, the top Democrat on the ways and means committee.

Tax cuts for corporations would be permanent while the cuts for individuals would expire in 2026 to comply with Senate budget rules. The tax cuts would take effect in January, and workers would start to see changes in the amount of taxes withheld from their paychecks in February.

Trump tax plan: the key points from the final bill Read more

The bill would slash the corporate income tax rate from 35% to 21%. The top tax rate for well-off individuals would be lowered from 39.6% to 37%.

The legislation repeals an important part of the 2010 healthcare law – the requirement that all Americans carry health insurance or face a penalty – as the GOP looks to unravel the law it failed to repeal and replace this past summer. It also allows oil drilling in the Arctic national wildlife refuge.

The $1,000-per-child tax credit doubles to $2,000, with up to $1,400 available in IRS refunds for families that owe little or no taxes.

Disgruntled Republican lawmakers from high-tax New York, New Jersey and California receded into the background as the tax train rolled. They oppose a new $10,000 limit on the deduction for state and local taxes.

The bill is projected to add $1.46tn to the nation’s debt over a decade. GOP lawmakers say they expect a future Congress to continue the tax cuts so they won’t expire. That would drive up deficits even further.

The Associated Press contributed to this report