Friday, December 10, 2010

Items added to tax cut bill to draw support

Speaker of the House Nancy Pelosi speaks to reporters after leaving a caucus of House Democrats on Dec. 7. The Obama administration is pushing for Congress to extend Bush-era tax cuts.
Speaker of the House Nancy Pelosi speaks to reporters after leaving a caucus of House Democrats on Dec. 7. The Obama administration is pushing for Congress to extend Bush-era tax cuts.

As Democrats in Congress battled in public over a proposal to extend Bush-era income tax cuts, a group of Democratic lawmakers are pushing to make subtle changes to help sweeten the pot.
The agreement worked out between President Obama and Republicanlawmakers would extend the expiring cuts for all taxpayers for two years, continue jobless benefits for the long-term unemployed and cut Social Security payroll taxes next year.
Many Democrats have balked at the compromise, particularly a decision to extend cuts for families earning more than $250,000 in taxable income. House Democrats voted Thursday during a closed meeting against bringing the deal to the floor unchanged.
"We will continue discussions with the president and our Democratic and Republican colleagues in the days ahead to improve the proposal before it comes to the House floor for a vote," House Speaker Nancy Pelosi, D-Calif., said after the vote.
An early draft of the legislation circulating on Capitol Hill that was obtained by USA TODAY includes dozens of other tax extensions, including tax credits for renewable electricity projects and ethanol, aimed at spurring hybrid car use.
Some Democrats were also pushing for an extension of the Build America Bonds program, in which the federal government pays 35% of the interest on local government borrowing for building and road projects. Nine senators signed a letter this week asking leaders to include the provision in the final tax bill.
"At a time when people are looking at that jobless number, this is an example of something proven to work," said Sen. Ron Wyden, D-Ore., an architect of the program.
The Senate is scheduled to vote on the tax deal on Monday, Senate Majority Leader Harry Reid said. White House spokesman Robert Gibbs said Obama was confident the bill would pass.
"The question is what kind of changes are necessary to get the House to support it and what kind of impact that would have on what it needs to get votes in the Senate," said Sen. Ben Nelson, D-Neb.
Much of the earlier discussion centered on the estate tax, which expires this year. The deal worked out by the White House would let couples pass $10 million onto heirs tax-free. Any inheritance above that threshold would be taxed at 35%.
"The estate tax provisions seem to be the most egregious," said Rep. Lloyd Doggett, D-Texas. "The estate tax changes just add to the debt and they do nothing to create jobs."
But it's unclear how much Republicans are willing to budge on any changes.
"This was a final agreement," said Sen. Jeff Sessions, R-Ala. "Once you open it up to amendments it becomes problematic."

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