Hopes for a comprehensive package of tax breaks began dimming Tuesday, as congressional negotiators lowered their expectations to a continuation of current law, even as leaders threatened a rare weekend session to finish talks over a catchall spending bill.
Negotiations over the two packages of legislation—one a six-year, $800 billion extension of several popular tax breaks and the other a $1.1 trillion bill funding every aspect of the federal government—had become intertwined in recent days. But House Speaker Paul Ryan sought to put some distance between the two on Tuesday, as leaders introduced a two-year, clean reauthorization of several expiring tax provisions as a fallback plan.
House Minority Leader Nancy Pelosi had been insisting on Democratic-favored tax provisions, in particular indexing the child tax credit to inflation. But Ryan told his conference at a closed-door meeting Tuesday morning that he had no qualms falling back on the two-year bill.
“We’re not going to get jammed,” Ryan said, according to a source in the room.
Top tax-writing staffers from both parties were meeting as recently as Tuesday afternoon. But some members worried that the package, which would make permanent some tax breaks preferred by each party, appears to be collapsing under its own weight. The Senate too began preparing a two-year fallback plan, even though Majority Leader Mitch McConnell said Tuesday that he is still pushing for the “more robust” deal.