LOS ANGELES (CBSLA)— House republicans were celebrating victory Thursday, their tax reform bill passed on party lines, all but 13 republicans voted yes, every democrat voted no.
Three California republicans voted against the bill: Darrell Issa and Dana Rohrabacher from Orange County, and Tom McClintock from central California.
The plan slashes the corporate tax rate, simplifies the tax code and doubles the standard deduction but also raises the debt and deficit.
Many tax experts say there are two provisions of the bill that can hurt California taxpayers. They will no longer be able to deduct the money they paid in state income taxes from their federal tax return and they won’t be allowed to deduct mortgage interest on homes that cost more than $500,000.
Professor Edward McCaffery is a tax law expert at USC:
“That’s going to ripple thru the entire housing market, people will not be able to afford as much house,” he says.
He says the doubling of the standard deduction under the house bill will provide a modest tax break for small middle class families, but large families would lose the personal deduction for each family member and have to pay more taxes under the plan.
“There are going to be winners and losers at every income level except the plutocrats, except the billionaires,” McCaffery says.