U.S. Senator Shelley Moore Capito (RW.Va.) asks questions during a Senate Fund Subcommittee hearing to approve the fiscal year 2022 budget proposal for the Centers for Disease Control and Prevention in the Dirksen Senate office building in Washington on Jan. May 2021 to be checked.

Greg Nash | Pool | Reuters

Republicans and President Joe Biden are closer to agreeing an infrastructure plan but have yet to resolve basic issues about the size of a package and payment, a GOP senator who led the effort said Thursday.

Senator Shelley Moore Capito and a group of Senate Republicans plan to present their counter-offer for infrastructure to Biden Thursday morning. The West Virginia Republican said the sides are nearing negotiations before Memorial Day, the date by which the White House wanted to see progress on the bipartisan talks.

“We’re still talking. I’m optimistic, we still have a big gap,” Capito told CNBC’s Squawk Box. “I think where we really fall short, we can’t get the White House to agree on a definition or scope of infrastructure that we believe corresponds to the physical core infrastructure.”

“The White House is still putting its human infrastructure into this package, and that’s just a beginner for us,” she continued, referring to Biden’s plans to put money into programs like caring for the elderly and disabled Americans.

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GOP lawmakers have signaled that their proposal will cost nearly $ 1 trillion. Biden’s revised Republican bid was $ 1.7 trillion – $ 600 billion less than his original plan.

It is unclear whether the two parties can overcome huge ideological differences in what constitutes infrastructure and how to pay for improvements in order to reach a bipartisan deal. If the negotiations are not promising, the Democrats will have to decide whether to try to pass an infrastructure bill on their own using specific budget rules.

The process would come with its own headache, as Senate Democrats would have to keep all 50 members of their caucus on board and adhere to strict rules on what can be included in a budgetary vote law.

Republicans have said they don’t want to levy taxes to cover the cost of improving transportation, broadband, and water systems. Biden has called for the corporate income tax rate to be raised from 21% – the level set by the GOP after the 2017 tax cut – to at least 25%.

“We can do this without … touching these tax cuts,” Capito told CNBC.

She mentioned lawmakers could route unused coronavirus aid funds to state and local governments to infrastructure or introduce usage fees for transportation like electric vehicles. These Republican solutions could get Biden into trouble.

The president has promised not to collect taxes on anyone who earns less than $ 400,000 a year. Usage fees or a gas tax hike would add an extra burden to many Americans whose incomes fall below the threshold.

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