Senate Democrats Call For Votes on Competing Tax Cut Plans

Posted July 11, 2012 at 8:24pm

Senate Democrats this evening called for a vote on competing Republican and Democratic proposals regarding the 2001 and 2003 tax cuts, but Republicans objected because they want to first see the Democratic plan in writing.

“I will be happy to take a look at what [Democrats are] offering, but I cannot at this time agree to lock in a vote at an indeterminate time on a proposal that has not yet been written,” Senate Minority Leader Mitch McConnell (R-Ky.) said on the Senate floor.

Votes on the proposals could come as soon as Thursday, with Democrats pressing to finish up work by the end of the week on their small-business tax cut bill currently on the floor. Reid also filed cloture on the bill and on an amendment from Sen. Mary Landrieu (D-La.) that would extend a raft of tax cuts to small businesses, including expanded expensing for certain capital investments.

McConnell’s comments came after Senate Majority Leader Harry Reid (D-Nev.) offered to hold a vote on a Democratic proposal to extend the tax cuts for households making less than $250,000 and a Republican plan seeking a one-year extension for all taxpayers in order to give Congress time to reform the tax code.

Reid’s offer also called for a vote on the Democrats’ small-business tax bill, currently under consideration in the Senate, and a House-passed small-business tax bill.

“I am trying to get a vote on what [McConnell] says he’s for, and what the president says he’s for, and what Republicans say they are for,” Reid said after hearing the GOP objection. “But I am happy to let the Republican leader read the exact language.”

“But let no one be fooled by this,” Reid continued. The Senate Republican amendment “doesn’t do anything to protect small businesses. It does every thing to protect [anti-tax advocate] Grover Norquist and his pledge.”

Reid said the only reason Republicans were opposing the Senate bill was because it has the support of President Barack Obama and Democrats in Congress and it would strengthen the economy, which would help the president.

“So Republicans are hiding behind a procedural trick: filibustering with unrelated amendments,” Reid said.

Under the Senate bill, which is part of Obama’s to-do list of legislation that he has recommended Congress pass, a 10 percent income tax credit would be provided on new payroll — through either hiring or increased wages.

The bill also extends “bonus depreciation” for one year. The provision allows businesses to write off the entire cost of major purchases in the year they are made rather than depreciate those expenses over many years.

The House-passed bill would give a 20 percent tax cut to businesses with fewer than 500 employees — a threshold Democrats argue is too broad and would benefit the likes of “billionaire hedge fund managers and mega-rich celebrities like Donald Trump,” Reid said.

Earlier Wednesday, Reid objected to a similar request for a vote by McConnell on the 2001 and 2003 tax cuts proposals, which Republicans said was evidence that Democrats were not serious about passing legislation and instead were seeking to use the floor to paint Republicans as hostile to the middle class.

“My good friend has had all day to come up with a written proposal, but I gather that so far they have been unable to do so,” McConnell said in response to Reid’s vote offer. “Our proposal is drafted and filed and has been available for all to see.”

The Democrats argue that their plan to extend tax cuts for those making $250,000 a year would help to make the tax code fairer for the middle class.

But Republicans oppose the Democratic plan, which Obama earlier this week called on Congress to enact, because they believe it would raise taxes small businesses.

“We’d be happy to set up a vote on this issue just as soon as the Majority Leader produces a bill to show us what tax increases they have in mind,” McConnell said. “I want to make sure that every one understands the differences in our positions. My goal … will be to pass a bill that protects small businesses by extending current income tax rates for one year to ensure that no one in America sees an income tax hike in January and tasking the Finance Committee to produce a bill that would enact fundamental, pro-growth tax reform.”

“Their goal will be the president’s proposal to raise taxes on nearly one million business owners in the middle of the worst economic recovery in modern times. The Senate ought to make absolutely clear which policy it supports,” McConnell said. “I look forward to the chance to do that.”