Daily Tax Update - May 22, 2008

FATE OF EXTENDERS BILL IN THE SENATE UNCLEAR:  Although the House overwhelming passed a $55.5 billion tax extenders bill yesterday, it was not approved by a veto-proof margin. The Administration has threatened to veto the bill in its current form. 

• The Senate will take up its bill sometime after the Memorial Day recess. Forty-one Senate Republicans have indicated they would block any extenders bill that raises taxes as offsets. 
• The Senate bill differs from the House bill in several ways: 
  • It would extend the expiring tax provisions for two years instead of one year,
  • It would patch the AMT for one year (there is no House AMT patch provision); (House Ways and Means Select Revenue Measures Subcommittee Chairman Richard Neal (D-MA) said that the House would act on a fully-paid-for AMT patch “in the near future.”) and,
  • It does not contain offsets. 
• After yesterday’s House vote, Ways and Means Committee Chairman Charles Rangel (D-NY) said, “I’m fairly confident we'll have very little problems in the Senate getting this passed into law. The White House's attitude is to veto and complain; they've given up on leadership a long time ago.”
• Ranking Committee member Jim McCrery (R-LA) countered, “This bill is dead on arrival in the other body. And even if this legislation somehow got through the Senate, the President has clearly indicated that he would veto this bill.”
• Republican Committee member Kevin Brady (R-TX) spoke out against a “last-minute special interest provision” in the bill that allows a deduction for trial lawyers' expenses in contingency cases. Brady called the bill “tainted” and said, “The wealthiest 1 percent of attorneys in America will receive $1.5 billion dollars of your money.”

TAX BILL INTRODUCED MAY 21st:
H.R.6106:  To amend the Internal Revenue Code of 1986 to temporarily reduce the excise tax on diesel fuel and kerosene to the rate applicable to gasoline.
Sponsor: Rep Bono Mack, Mary [CA-45] (introduced 5/21/2008)      Cosponsors (None)

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