Senate Passes GOP Tax Reform Bill; House Must Revote

UPDATED 12/20/17 12:45 a.m.

WASHINGTON (CBSNewYork/AP) -- The U.S. Senate early Wednesday voted in favor of the Republican tax bill, but it will need a new vote in the House of Representatives.

The Tax Cuts and Jobs Act was approved by a vote of 51 to 48.

During the vote, protesters began chanting, "Vote them out! Kill the bill!" and yelled against its passage. Vice President Mike Pence repeatedly pounded his gavel and directed the sergeant-at-arms to "restore order in the gallery."

As CBS2's Dick Brennan reported, House lawmakers learned in the late afternoon that they would have to vote on it again earlier on Tuesday.

The GOP tax bill passed by a vote of 227-203 in the House in the early afternoon. But Democrats said the bill violates three provisions of Senate rules and must be removed.

As CBS2's Tony Aiello reported, the House now must revote on the bill.

"They're in such a rush that they made several mistakes, and so we're actually going to have to excise those offending provisions and then they're going to have to take a revote," said U.S. Sen. Brian Schatz (D-Hawaii).

House Minority Leader Nancy Pelosi (D-California) said the need for the new vote is proof that the bill is "shoddily written." But nonetheless, it is still expected to pass on party lines and is still expected to become law.

"When it comes down to your final vote, is our country better off having this once in a generation opportunity for tax reform?" said U.S. Sen. Bob Corker (R-Tennessee).

"This tax bill will be an anchor around the ankles around every Republican, and if they haven't learned it now, they will learn it in next November," said Senate Minority Leader Charles Schumer (D-New York).

Late Tuesday, the Senate went through motions of debate – even though 51 Republicans had already lined up to pass the $1.6 trillion plan.

"It's not tax reform," said U.S. Sen. Elizabeth Warren (D-Massachusetts). "It is a heist -- a heist that steals from millions of middle class families and hands that money over to the wealthy."

The bill passed to much fanfare Tuesday afternoon, fearing procedural violations in the version it already passed.

The vote will likely take place Wednesday. The Senate has been expected to take up the bill later Tuesday evening.

Several provisions in the House-passed overhaul appear to violate the procedural rules of the Senate, according to Democrats, and the Senate will need to vote on whether to waive the rules

After the bill gets a final stamp of approval in the Senate, the bill will return to the house for a re-vote.

One possible violation involves the use of 529 savings accounts for home-schooling, and private elementary and high schools. Another exempts colleges from a new endowment tax if they have fewer than 500 students paying tuition. Another objection appears technical in nature, as the bill repeals a section by its number, instead of the title of the section.

The news of a revote comes after much fanfare upon the bill's passage in the House. House members approved the bill in a 227-203 vote. Treasury Secretary Steve Mnuchin sat in the Speaker's box inside the chamber, observing the vote.

The news of a re-vote comes after much fanfare upon the bill's passage in the House. House members approved the bill in a 227-203 vote.

The bill represents the first significant restructuring of the tax code in 31 years, and it is now one vote and one signature away from reality.

"It's an honor to be Speaker of the House to see this," House Speaker Paul Ryan (R-Wisconsin) said when it initially passed. The last time this got done, the job I had, I was working the Quarter Pounder grill at McDonald's at the intersection of Highway 14 and 990 in Janesville, Wisconsin."

The tax bill would reduce the rates at every income level temporarily. It would also double the standard deduction for individuals and families.

But the biggest winners are corporations, which would see their rates slashed significantly and permanently.

Critics say it the bill is geared toward helping corporations and wealthy Americans more than the middle class. Meanwhile, an independent analysis from the tax policy center says 80 percent of the nation will get a tax cut, while 5 percent will see a tax rise. But homeowners in the Tri-State Area will get hit with a double whammy.

The deduction for state and local income taxes or property taxes are capped at $10,000, and the mortgage interest deduction is lowered to $750,000 for new home purchases.

Voting against the plan, U.S. Rep. Lee Zeldin (R-New York) called it a "redistribution of wealth, taking money from New York to pay for tax cuts elsewhere."

"It was a tough fight. We fought hard. But bottom line is we lost," added U.S. Rep. Peter King (R-New York). "It's a bad bill for Long Island and New York."

King said the value of Long Island homes could plunge 10 to 15 percent.

U.S. Rep. Nydia Velazquez (D-New York) savaged the bill
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"This bill is morally bankrupt," she said. "It harms American citizens everywhere."

But supporters said doubling the standard deduction – $12,000 for individuals and $24,000 for couples filing jointly – is a big benefit.

"This essentially is going to mean that about 85 percent of taxpayers are going to be able to claim this deduction -- makes filing much easier," said CBS News Business Analyst Jill Schlesinger. "Right now, 70 percent claim it."

The only Republican in the Tri-State Area to vote for the bill was Tom McArthur of New Jersey's 3rd district.

Demonstrators gathered outside the New York Stock Exchange to protest the Republican tax overhaul.

The crowd chanted, "Tax the rich, not the poor, we won't take it anymore'' and "Kill the bill, don't kill us." They also held signs in the form of gravestones, saying things like "Died to help the rich get richer.''

Some demonstrators then sat down in front of the exchange, and were arrested after police warnings.

(© Copyright 2017 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)