Daily Tax Update - February 08, 2006

PRESIDENT DISCUSSES BUDGET AND TAXES IN NEW HAMPSHIRE:
Today, President Bush stressed the importance of promoting economic growth by keeping taxes low. The President said, "First, we're going to keep the taxes low to make sure the economy grows. My philosophy is this: When Americans are allowed to keep more of their own money to spend and save and invest, that helps the economy grow; and when the economy grows, people can find work. If entrepreneurs have more money in their pocket, they're going to use it to expand their businesses, which means somebody is more likely to find work. If consumers have more money in their pocket, they're likely to demand additional good or services. And in a marketplace economy when somebody demands a good or a service, somebody meets that demand with product, or the service. And when that demand is met, it means somebody is more likely to find work. Cutting taxes means jobs for the American people." The President added, "One of the interesting things that I hope you realize when it comes to cutting taxes is this tax relief not only has helped our economy, but it's helped the federal budget. In 2004, tax revenues to the Treasury grew about 5.5 percent. . . . And last year those revenues increased 14.5 percent, or $274 billion. And the reason why is cutting taxes caused the economy to grow, and as the economy grows there is more revenue generated in the private sector, which yields more tax revenues." The President also reiterated his call for Congress to make the tax cuts permanent. The President said, "If Congress doesn't act, your taxes are going to go up -- and you're not going to like it -- and it's going to hurt the economy. And so Congress needs to make the tax relief we passed permanent."

  • The President’s remarks can be accessed here.  

HOUSE TO VOTE ON PROCEDURAL STEP TO APPOINT TAX RECONCILIATION CONFEREES:
Today, the House will vote on a motion to go to conference with the Senate on the $70 billion tax cut reconciliation bill. After the House approves the motion, the conferees can be named. The Senate may appoint its conferees later this week. The House is not in session Thursday or Friday, so next week is the earliest a conference could convene. The negotiations are not expected to conclude until March.

TAX BILL INTRODUCED FEBRUARY 7:

  • H.R. 4706 sponsored by Rep. Pete Stark (D-CA) would deny any deduction for certain gifts and benefits provided to physicians by prescription drug manufacturers.

INTERNAL REVENUE SERVICE - CIRCULAR 230 DISCLOSURE:
As provided for in Treasury regulations, advice (if any) relating to federal taxes that is contained in this communication (including attachments) is not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any plan or arrangement addressed herein.

STEPTOE & JOHNSON LLP - TAX PRACTICE
Steptoe & Johnson LLP has one of the largest and most diverse law firm tax practices in the country. The practice covers the entire spectrum of federal taxation, including representation of businesses before the Congress, Treasury and the national office of the IRS; transactional planning for domestic and multinational corporations; complex audit and controversy work for corporations and other business interests contesting IRS adjustments; litigation before the Tax Court, Court of Federal Claims, district courts, courts of appeals and the Supreme Court. The firm's tax practice also encompasses all aspects of employee benefits (ERISA), executive compensation, tax-exempt organizations and charitable giving.  Steptoe has an extensive state and local tax practice, representing an array of business clients on complex sales and use tax, corporate income tax and property tax matters, both advising those clients and handling audits, administrative appeals, and litigation for them.  Read  more information on Steptoe's tax practice