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There are no votes scheduled in the House and Senate today. Finally, legislation memorializing the agreement between the White House and congressional leaders has been introduced in the Senate and provided to the American public. This legislation is titled the Reid-McConnell Amendment. Here is a PDF of a summary of the agreement on CQ (subscription required).
The Senate are debating this legislation today and a vote is scheduled on Monday on the package. Prospects for this deal are still in flux in the House and there is no way to know right now if this package will make it to the President’s desk. There is also a concern that the House may make changes to the bill that will force some Republicans to walk away from the deal.
Here is the current situation. According to a the Senate Democrat web site:
The cloture vote on the motion to concur with respect to HR4853, with an amendment (Reid-McConnell tax amendment #4753) will occur at 3pm Monday, December 13. Senator Reid announced that this vote will be held open so that senators are able to make the vote.
So the Senate is debating a tax bill today, H.R. 4853, the Middle Class tax Relief Act of 2010. This the bill that the Senate rejected last Saturday and Senate Majority Leader Harry Reid (D-NV) is using this tax bill to carry the negotiated agreement, in the form of a complete substitute amendment, back to the House. The Senate can’t originate tax bills according to the Constitution, Article 1 Sec. 7, so they have to take up a House passed tax bill so as not to violate the Constitution.
All bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.
The debate has commenced and Senator Bernie Sanders (I-VT) has taken to the Senate floor today to declare his opposition to the package. A vote is scheduled for 3pm on Monday to shut off debate on the amendment. Work on the package is expected to be completed by early next week.
It is expected that the Senate will pass this measure. Once the Senate passes the tax bill it will to the House.
The House Democrat Caucus has declared that they don’t want to take up the bill as currently constituted. The House may take up the bill and modify the Estate Tax compromise to lower the threshold on the tax down to about $3.5 million from $5 million and raise the tax rate on those estates from 35% to 45%. Also, it is expected that House leaders will buy votes from objecting Democrats by adding new tax earmarks to this bill.
Evidently, this compromise has expanded beyond the original agreement between President Obama and Congressional leaders. The Senate added some new provisions to buy some votes that are outside of the announced agreement.
According to Congressional Quarterly (subscription required):
The inclusion of some energy-related tax incentives may help build support among House Democrats.
Here are some of the energy provisions added to the bill to buy the vote of liberals in states that have ethanol and coal.
TITLE VII–TEMPORARY EXTENSION OF CERTAIN EXPIRING PROVISIONS
Sec..701..Incentives for biodiesel and renewable diesel.
Sec..702..Credit for refined coal facilities.
Sec..703..New energy efficient home credit.
Sec..704..Excise tax credits and outlay payments for alternative fuel and alternative fuel mixtures.
Sec..705..Special rule for sales or dispositions to implement FERC or State electric restructuring policy for qualified electric utilities.
Sec..706..Suspension of limitation on percentage depletion for oil and gas from marginal wells.
Sec..707..Extension of grants for specified energy property in lieu of tax credits.
Sec..708..Extension of provisions related to alcohol used as fuel.
Sec..709..Energy efficient appliance credit.
Sec..710..Credit for nonbusiness energy property.
Sec..711..Alternative fuel vehicle refueling property.
This was merely one way that votes have been purchased for this package. There are others. Some tax earmarks, usually carried in the so called “Tax Extenders Bill,” have also been added to this package to lock down a few more Senate votes.
Subtitle C–Business Tax Relief
Sec..732..Indian employment tax credit.
Sec..733..New markets tax credit.
Sec..734..Railroad track maintenance credit.
Sec..735..Mine rescue team training credit.
Sec..736..Employer wage credit for employees who are active duty members of the uniformed services.
Sec..737..15-year straight-line cost recovery for qualified leasehold improvements, qualified restaurant buildings and improvements, and qualified retail improvements.
Sec..738..7-year recovery period for motorsports entertainment complexes.
Sec..739..Accelerated depreciation for business property on an Indian reservation.
Sec..740..Enhanced charitable deduction for contributions of food inventory.
Sec..741..Enhanced charitable deduction for contributions of book inventories to public schools.
Sec..742..Enhanced charitable deduction for corporate contributions of computer inventory for educational purposes.
Sec..743..Election to expense mine safety equipment.
Sec..744..Special expensing rules for certain film and television productions.
Sec..745..Expensing of environmental remediation costs.
Sec..746..Deduction allowable with respect to income attributable to domestic production activities in Puerto Rico.
Sec..747..Modification of tax treatment of certain payments to controlling exempt organizations.
Sec..748..Treatment of certain dividends of regulated investment companies.
Sec..749..RIC qualified investment entity treatment under FIRPTA.
Sec..750..Exceptions for active financing income.
Sec..751..Look-thru treatment of payments between related controlled foreign corporations under foreign personal holding company rules.
Sec..752..Basis adjustment to stock of S corps making charitable contributions of property.
Sec..753..Empowerment zone tax incentives.
Sec..754..Tax incentives for investment in the District of Columbia.
Sec..755..Temporary increase in limit on cover over of rum excise taxes to Puerto Rico and the Virgin Islands.
Sec..756..American Samoa economic development credit.
Sec..757..Work opportunity credit.
Sec..758..Qualified zone academy bonds.
Sec..759..Mortgage insurance premiums.
Sec..760..Temporary exclusion of 100 percent of gain on certain small business stock.
Subtitle D–Temporary Disaster Relief Provisions
SUBPART A–NEW YORK LIBERTY ZONE
Sec..761..Tax-exempt bond financing.
SUBPART B–GO ZONE
Sec..762..Increase in rehabilitation credit.
Sec..763..Low-income housing credit rules for buildings in GO zones.
Sec..764..Tax-exempt bond financing.
Sec..765..Bonus depreciation deduction applicable to the GO Zone.
Expect this package to be loaded up with more tax earmarks when this bill is taken up by the House to buy votes. It seems as if the Republicans have yet to draw a line in the sand. Senators need to establish conditions that will force them to walk away from this deal. Without any walk away position, the Senate Republicans allow the House discretion to further change the deal in a manner that either fails in the Senate or passes with Republican favored provisions watered down. There really is no way for Republicans to stop the horse trading if they don’t make a declaration that this agreement can’t be changed by the House or they will walk from the deal.