Tax News

CCH (cch.taxgroup.com) reports:

  The House Ways and Means Committee plans to mark up the American Recovery and Reinvestment Tax Bill of 2009 (HR 598) on January 22, despite criticism from House GOP lawmakers who object to some of the tax provisions in the bill. Committee ranking member Dave Camp, R-Mich., and House Minority Leader John Boehner, R-Ohio, said the legislation should undergo the normal committee hearings, thereby giving lawmakers the chance to receive views from industry experts.

  Boehner and Camp were joined by other House Republicans at a press briefing on January 21 where lawmakers said they planned to meet with President Obama and present their own ideas for more effective tax incentives to provide economic stimulus. In particular, Camp objected to the Making Work Pay tax credit in the measure because it would provide a greater tax incentive to people than the amount they actually paid in taxes. Instead, House Republican Whip Eric Cantor, R-Va., said that Obama should consider other tax incentives for families, small businesses, self-employed workers and entrepreneurs.

  Cantor said they planned to let Obama know that House Republicans are opposed to the Democratic economic stimulus legislation, especially since more than $500 billion is targeted to new government spending. The largest item in the tax bill is a two-year Making Work Pay tax credit, which would cost $145.3 billion over 10 years (TAXDAY, 2009/01/16, C.1). Members of the House Republican Study Committee introduced their own legislation, the Economic Recovery and Middle Class Relief Bill (HR 470), on January 13. Among other things, the GOP legislation would provide a 5-percent, across-the-board income tax cut, increase the child tax credit to $5,000, repeal the alternative minimum tax and make permanent the current 15-percent tax rate on capital gains and dividends.

  By Stephen K. Cooper, CCH News Staff