By MARCY GORDON and STEPHEN OHLEMACHER
Associated Press

WASHINGTON (AP) - Senate Republican leaders wrangled with the last few GOP holdouts Thursday as they pushed toward passing the first major rewrite of the nation's tax code in more than three decades.

Majority Leader Mitch McConnell, R-Ky., said he expected a final vote late Thursday or early Friday on a $1.4 trillion package that would slash the corporate tax rate, offer more modest cuts for families and individuals and eliminate several popular deductions.

Lawmakers would then try to reconcile the Senate package with one passed by the House in the hope of delivering a major legislative accomplishment to President Donald Trump by Christmas. Republicans have cast passage of a tax overhaul as a political imperative to ensure they hold their House and Senate majorities in next year's midterm elections.

"We're heading down the homestretch," McConnell told reporters Thursday.

In a dramatic roll call that lasted an hour, the package cleared a procedural hurdle that threatened to derail the GOP's entire tax drive.

Democrats forced on a vote on whether to return the measure to the Senate Finance Committee so it could be rewritten to not make federal deficits larger. After holding out until the last moment, Sens. Bob Corker of Tennessee, Ron Johnson of Wisconsin and Jeff Flake of Arizona eventually joined fellow Republicans to scuttle the Democratic proposal.

Had it succeeded, it would have derailed the bill.

The dispute was over a ruling by the Senate parliamentarian that a key provision of the bill designed to guard against big deficits would violate Senate rules about what could be in the tax bill. Sen. Bob Corker, R-Tenn., has been pushing to add automatic tax increases in future years if the package doesn't raise as much revenue as projected.

With the provision dead, Corker said senators would change the bill to roll back some of the tax cuts in future years, regardless of whether tax revenues meet expectations.

The package would add $1 trillion to the budget deficit over the next decade, much less than previously projected, according to a congressional analysis released Thursday.

The tax bill would increase economic growth, generating an additional $458 billion in tax revenue, according to the analysis by the nonpartisan Joint Committee on Taxation. The committee previously estimated that the package would add $1.4 trillion to the deficit.

The additional revenue is a boost to the bill but is still far short of the $2 trillion promised by Treasury Secretary Steven Mnuchin.

Two Republican senators, John McCain of Arizona and Lisa Murkowski of Alaska, announced their support for the tax package Thursday, giving it a major boost. Both McCain and Murkowski had voted against the GOP bill to dismantle the Obama health care law this past summer in a blow to the GOP.

Their support is key because Senate Republicans hold a slim 52-48 majority in the Senate, meaning they can only afford to lose two votes, with Vice President Mike Pence casting the tie-breaker.

"It's clear this bill's net effect on our economy would be positive," McCain said in a statement. "This is not a perfect bill, but it is one that would deliver much-needed reform to our tax code, grow the economy, and help Americans keep more of their hard-earned money."

Murkowski said she supports the tax bill now that it would allow oil drilling in Alaska's Arctic National Wildlife Refuge. Murkowski got the provision added earlier this week, but the initial version violated arcane Senate rules about which provisions can be added to the tax bill.

Murkowski said Thursday the provision was tweaked to comply. "We have done it and we're ready to go," she said.

Drilling in the refuge has long been a contentious issue, pitting environmentalists against those who want to increase domestic oil production.

Senators were still grappling with several issues Thursday, including a provision to add a deduction for local property taxes. The current Senate bill completely eliminates the federal deduction for state and local taxes, a popular deduction in the Democratic-leaning states of New York, New Jersey, California and Illinois as well as many wealthy suburbs nationwide.

Sen. Susan Collins, R-Maine, proposed an amendment to let homeowners deduct up to $10,000 in local property taxes on the their federal returns. It is similar to a provision in the House-passed bill.

Without the deduction, Collins said, it would be "very problematic for me" to vote for the bill.

Collins would make up the estimated $146 billion in lost revenue by keeping the personal income tax rate for the wealthiest earners at 39.6 percent and make a smaller cut in the corporate tax rate. Trump and other Republicans insist that the corporate tax rate must be reduced from 35 percent to 20 percent.

Sen. Steve Daines, R-Mont., backed the package Wednesday after securing an increase in the deduction for business income from 17.4 percent to 20 percent. The deduction is for business owners who report their business income on their individual tax returns.

Johnson, the Wisconsin Republican, has also been pushing to increase the tax break for these business owners. He has been noncommittal about his support, even with the change secured by Daines.

The tax package would mark the first time in 31 years that Congress has overhauled the tax code.

The plan would nearly double the standard deduction to around $12,000 for individuals and about $24,000 for married couples. The tax cuts for individuals would expire in 2026 while the corporate tax cuts would be permanent.

Under Senate rules, senators can offer unlimited amendments, setting up the possibility of dozens of votes that could stretch all night into Friday morning.

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