The House passed a bill promising relief for another year from the spread of the alternative minimum tax, but the bill already faces opposition from the White House.
The bill passed by a vote of 233-189. The legislation, sponsored by House Ways and Means Chairman Charles B. Rangel, D-NY, would provide tax relief to middle-class families by ensuring that the number of taxpayers subject to the AMT will not increase from approximately 4 million to an estimated 25 to 30 million. “The AMT is an outdated, unfair tax that should not even be part of our tax code,” said Rangel in a statement. “However, in the seven years the Bush Administration has been in office, they have not given us a tax reform bill to do what everyone in this House would want to and remove this fiscal burden from more than 25 million taxpayers. So now we have to pass a so-called ‘patch’ to make sure these families don’t see their taxes increase through no fault of their own.” The White House objected to the bill’s offsets for raising taxes and revenues in other areas to compensate for the loss in AMT revenue. "The administration urges Congress to reduce the risk of disruption to the 2009 tax-filing season by eliminating tax increases from the bill," said a statement from the White House.
The bill includes a provision raising taxes on private equity and hedge fund managers. That provision had to be dropped from last year’s AMT patch legislation. Other provisions would eliminate tax breaks for major oil and gas companies, restrict multinational companies from sheltering U.S. income in off-shore tax havens, and force credit card companies and payment services such as PayPal to report some types of merchant transactions. The bill must now go to the Senate for consideration.
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