House passes Republican business tax cut
WASHINGTON (Reuters) - The Republican-controlled House of Representatives on Thursday passed a tax break for small businesses, giving voters a stark alternative to President Barack Obama's politically popular "Buffett Rule" surtax on the wealthy.
In an escalating election-year war of words over taxes, the Republican measure, like the Buffett Rule, is not expected to become law. It is opposed by Democrats, who control the Senate, where the bill was expected to die.
The legislation, pushed by House Majority Leader Eric Cantor, would give a 20-percent tax deduction to employers with 500 or fewer workers, a move that Republicans say is important for job creation and economic growth.
It was approved on a mostly partisan 235-173 vote.
Democrats blasted the bill because it does not limit benefits based on receipts, allowing law firms, hedge funds and other high-income businesses to benefit.
"This isn't about mom and pop ... It's about popping the cork for wealthy taxpayers," Representative Sandy Levin, the top Democrat on the tax-writing House Ways and Means Committee, said in floor debate.
Cantor responded that the bill used the government's own definition of small business.
"This week when every American filed their tax returns, the other party in the Senate voted to increase taxes," Cantor said. "We should not be taking money out of those we need to create jobs."
With both parties eyeing the November 6 presidential and congressional elections, Senate Republicans on Monday blocked a measure that would have imposed a 30 percent minimum tax on households that earn more than $1 million a year.
It was championed by Obama and multibillionaire Warren Buffett who said it was needed to help make the rich pay a fairer share of taxes. Republicans said the Buffett Rule tax would have hurt small business.
Cantor's one-year tax cut would cost taxpayers about $46 billion. Democrats seized on the cost, noting it would add to already huge budget deficits that have rattled global financial markets.
Individual employers making more than $1 million get the biggest break under the bill, an average $45,000 cut, according to the centrist Tax Policy Center.
Senate Democrats are offering their own bill aimed at small business, which includes an employer hiring credit and a tax break on capital investments known as bonus depreciation.
- Lost airliner was diverted deliberately: Malaysian PM |
- Exclusive: Radar data suggests missing Malaysia plane deliberately flown way off course - sources
- Malaysia PM says lost plane's movements indicate a deliberate act
- UPDATE 2-Satellite data shows missing Malaysia plane may have flown thousands of miles-source
- UPDATE 1-Rolls-Royce concurs with Malaysia on missing jet's engine data