Thursday, December 02, 2010

Today's House Vote on Middle Class Tax Cuts

Here are a few interesting infobits on the US House vote today on middle class tax cuts.

Wondering how Pennsylvania's congressional delegation voted? Here's a breakdown:

* Altmire, Jason,(4th) - Y
* Brady, Robert, (1st) - Y
* Carney, Christopher P., (10th) - Y
* Critz, Mark, (12th) - Y
* Dahlkemper, Kathy, (3rd) - N
* Dent, Charles W., (15th) - N
* Doyle, Mike, (14th) - Y
* Fattah, Chaka, (2nd) - Y
* Gerlach, Jim, (6th) - N
* Holden, Tim, (17th) - Y
* Kanjorski, Paul E., (11th) - Y
* Murphy, Patrick J., (8th) - Y
* Murphy, Tim, (18th) - N
* Pitts, Joseph R., (16th) - N
* Platts, Todd, (19th) - N
* Schwartz, Allyson Y., (13th) - Y
* Sestak, Joe, (7th) - Y
* Shuster, Bill, (9th) - N
* Thompson, Glenn W., (5th) - N

A full congressional roll call with votes is available.

Congressman Joe Sestak released this statement:

Congressman Joe Sestak (PA-07) voted today to help pass tax relief for all Americans and prevent an unaffordable financial burden for the middle class that would occur if tax cuts are allowed to expire after December 31, 2010, as currently scheduled. The House approved the Middle Class Tax Relief Act of 2010 by a 234-188 margin.

“It was in the best interests of the working families and our economy that I proudly helped pass a critical extension of middle class tax cuts for those who need relief in difficult times,” said Congressman Sestak. “Not acting would do considerable harm to Americans who are trying to provide for themselves and their families as our economy recovers from the worst recession since World War II. While all Americans will receive relief, the decision to not extend tax cuts that only impact the wealthiest individuals and businesses demonstrates a lesson that should have been learned from that recession: wealth does not trickle down from the ultra rich. After a decade of irresponsibly-formed tax policy that created record deficits and debt, we simply cannot afford an extra $700 billion in tax breaks for the wealthiest few who do not have an incentive to reinvest that money in our economy. I urge the Senate to swiftly pass this legislation and give economic certainty to all American families before the tax cuts expire at the end of this year.”

The Middle Class Tax Relief Act of 2010 permanently extends the marginal tax rate reductions enacted by the Economic Growth and Tax Relief Reconciliation Act (EGTRRA) of 2001 for all tax brackets affecting income up to $200,000 for individuals and $250,000 for couples filing jointly. In addition, the legislation makes permanent a number of other key provisions impacting the middle class and small businesses by:

* Permanently reducing capital gains and dividend tax relief for middle-class taxpayers on adjusted gross income up to $200,000 for single filers and adjusted gross income up to $250,000 for married couples filing jointly. The bill would maintain the current 15% rate for middle-class taxpayers.
* Permanently extending EGTRRA and ARRA improvements to the child tax credit. EGTRRA doubled the value of the child tax credit from $500 to $1,000, allowed the child tax credit to be claimed against the alternative minimum tax, and enhanced the refundable child tax credit. The American Recovery and Reinvestment Act of 2009 (“ARRA”) further enhanced the refundable child tax credit by allowing taxpayers to begin claiming the refundable credit once the taxpayer has received $3,000 of earned income.
* Permanently extending marriage penalty relief for middle-class taxpayers. Prior to EGTRRA, numerous marriage penalties existed in the tax code. Among other things, EGTRRA increased the basic standard deduction for a married couple filing a joint return to twice the basic standard deduction for an unmarried individual filing a single return and also increased the size of the 15% regular income tax bracket for a married couple filing a joint return to twice the size of the corresponding rate bracket for an unmarried individual filing a single return. The bill would permanently extend this tax relief.
* Permanently extending education tax incentives, such as the deduction of student loan interest (maximum of $2,500) for single filers with adjusted gross income up to $75,000 and married couples filing jointly with adjusted gross income of $150,000.

The expiration of tax breaks for the very wealthy will not target small businesses, according to the independent Tax Policy Center, which has found that only 3.2 percent of the wealthiest business owners would be affected and fewer than half of them earn the majority of their annual income from their businesses. They include hedge fund managers, owners of multinational companies and lobbyists.

Finally, the bill provides a two-year extension of alternative minimum tax (AMT) relief to protect 25 million families from the AMT.

A few more interesting notes about the votes.

Ezra Klein did some research on presumptive next Speaker of the House John Boehner's district and how it would be affected by his "no" vote:
There are 238,781 households in John Boehner's district. There are 2,824 of them with an income above $200,000. That's 1.1 percent. And that 1.1 percent is too large, as many of those people make between $200,000 and $250,000, and so every dollar of their income will be eligible for the tax cuts the Democrats are pushing.

Sen. Lamar Alexander make an interesting statement in the Senate, noting that a proposed compromise would not affect the people in his state but he opposed it nonethless. From PoliticalCorrection:
With members of Congress fighting over the fate of the expiring Bush tax cuts, Sen. Chuck Schumer (D-NY) has put forward a compromise that would maintain the current rates on all earnings under $1 million. Even though Schumer's plan raises President Obama's original threshold for letting upper-income tax cuts expire by a multiple of four, Republican lawmakers are sticking with their dubious argument that such a plan would be unfair to small businesses across the country.

Yesterday, however, Sen. Lamar Alexander (R-TN) undermined the credibility of his party's claims. While speaking on the Senate floor, Alexander said that even though he opposes the proposal, he was "delighted" by Schumer's willingness to target his own constituents for tax increases. "Most of the people whose taxes he's trying to raise live in New York," he said. "I mean, they're not in Tennessee. We're a relatively low income state." Joking that Schumer's plan basically amounts to a "tax earmark," Alexander argued that it would "raise taxes on just a small number of people, most of whom live on Wall Street in New York.

Strange days indeed.

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