US lawmakers reach $78 billion tax deal for businesses, families

WASHINGTON (Reuters) -Congressional negotiators have agreed on a nearly $80 billion bipartisan deal providing tax benefits geared toward businesses and low-income families, the leaders of the Senate Finance and House Ways and Means committees said on Tuesday.

The $78 billion package would temporarily expand the Child Tax Credit and boost the low-income housing tax credit while also bringing back a range of deductions for companies, the two committee chairmen said in a joint statement.

The deal also includes disaster tax relief, among other provisions, Senate Finance Committee Chairman Ron Wyden, a Democrat, and House Ways and Means Committee Chairman Jason Smith, a Republican, said of the deal.

Any package must still pass both the Democratic-led Senate and the Republican-controlled House of Representatives before U.S. President Joe Biden could sign it into law at a time when lawmakers are scrambling to keep the government funded.

The agreement comes as Congress aims to avert a partial government shutdown and keep federal agencies operating into March by passing a short-term spending bill to temporarily fund the U.S. government, with some spending set to expire this week.

It would generate more than $70 billion by curbing an employee retention tax credit passed amid the COVID-19 pandemic aimed at helping businesses avoid layoffs, Wyden and Smith said.

(Reporting by Susan Heavey; Editing by Doina Chiacu)