Go to Admin » Appearance » Widgets » and move Gabfire Widget: Social into that MastheadOverlay zone
The Senate is moving to pass a package that would spare taxpayers at every income level from a significant tax increase on Jan. 1.
The package will then go to the House, where Democrats are fuming over extended tax breaks for the wealthy that President Barack Obama negotiated with Senate Republicans. House Democrats are considering possible changes, perhaps holding a vote to enact a higher estate tax than Obama negotiated. But even critics of the package say they expect it to pass as is.
“There’s a political reality here,” said Rep. Bill Pascrell Jr., D-N.J. “We can jump up and down all we want about the higher-end estate taxes, and I don’t think anything’s going to change because the Senate isn’t going to change it.”
The Senate has scheduled a midday Wednesday vote on the bill. It is expected to easily pass the Senate with broad bipartisan support after clearing a procedural vote Monday, 83-15.
“I think the Senate is going to pass this measure ensuring that no one’s taxes go up by a very significant margin, and I hope that our friends in the House will understand that that’s the best way to go forward — simply pass the Senate bill, get it down to a president who supports the understanding,” said Senate GOP leader Mitch McConnell of Kentucky.
McConnell warned House Democrats that any changes could derail the entire package.
“This agreement is not subject to being reopened,” McConnell said.
The bill would extend expiring tax cuts at every income level that were enacted during the presidency of George W. Bush. It also would renew a program of jobless benefits for the long-term unemployed that is due to lapse, and enact a one-year cut in Social Security taxes. The bill’s cost, $858 billion, would be added to the deficit.
At the insistence of Republicans, the plan includes a more generous estate tax provision: The first $10 million of a couple’s estate could pass to heirs without taxation. The balance would be subject to a 35 percent tax rate.
The lower estate tax infuriated some Democrats who were already unhappy with Obama for agreeing to extend tax cuts for individuals making more than $200,000 and couples making more than $250,000.
“This administration fights for nothing,” said Rep. David Wu, D-Ore.
The estate tax was repealed for 2010. But under current law, it is scheduled to return next year with a top rate of 55 percent on the portion estates above $1 million — $2 million for couples.
House Democratic leaders want to bring back the 2009 estate tax levels. That year, individuals could pass $3.5 million to their heirs, tax-free. Couples could pass $7 million, with a little tax planning, and the balance was taxed at a top rate of 45 percent.
House Democrats met in a closed-door session Tuesday evening in which member after member stood up and vented about various aspects of the bill. Other House Democrats, however, said they were eager to pass the package.
Thirty-one members of the conservative Blue Dog Democrats sent a letter to House Speaker Nancy Pelosi urging quick passage of the bill.
“It is time for us to put aside the partisan talking points and accomplish what the American people sent us here to do,” said the letter.
Copyright © 2010 The Associated Press