Politics: A key Senate Republican admitted the current tax reform bill can't pass without significant changes

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Senator Orrin Hatch admitted that the Tax Cuts and Jobs Act doesn’t qualify for budget reconciliation under the Senate’s Byrd Rule.

  • The Republican tax bill can't pass the Senate in its current form due to a key Senate rule.
  • Sen. Orrin Hatch, the author of the Senate's Tax Cuts and Jobs Act, admitted this flaw during a committee hearing Monday.

The Senate Republican legislation to overhaul the federal tax code can't pass the chamber as currently constructed, a top GOP senator admitted Monday.

Republicans are using the process of budget reconciliation to try to pass the Tax Cuts and Jobs Act (TCJA) with a simple majority vote. To do that, the bill has to abide by what's known as the Byrd rule, a provision of which specifies that the legislation cannot add to the federal deficit outside of a 10-year budget window.

Multiple analyses have found it would. On Monday, Sen. Orrin Hatch, chair of the Senate Finance Committee and author of the TCJA, said Republicans would have to fix the legislation opening remarks for the markup of the bill on Monday.

Hatch said the bill “leaves us with some work to do” to both make the cuts in the TCJA permanent and fit it within the Byrd rule parameters.

“We are, of course, aware of this problem and are working to ensure that the reduced rates and additional reforms designed to bring investment back to the United States and create more American jobs remain in place past the 10- year budget window,” Hatch said.

Republicans aides had reportedly been admitting that the bill missed the Byrd mark for some time, but Hatch's recognition is the most high-profile public acknowledgement yet.

What exactly Republicans could look to change about the tax bill is not immediately clear. Hatch submitted a generic amendment to the slew of amendments that could be considered during the committee's markup. The amendment would allow him to make a wide swath of changes to ensure the bill qualifies under Senate rules.

Hatch said in his remarks that he is still mulling possible changes, but said he wants to the preserve large proposed overhaul of the tax code on the business side.

“There’s no real cause for concern at this point,” Hatch said. “But I do want to make clear that we’re looking at a number of alternatives that will fill the necessary gaps and we have every intention of making the business reforms permanent.”