House Passes GOP Bill to Extend Bush-Era Tax Rates

House lawmakers on August 1 passed GOP legislation that would extend the middle-class tax relief enacted in 2001 and 2003 for one year. By a largely party-line vote of 256 to 171, the House approved the Job Protection and Recession Prevention Bill of 2012 (HR 8 ). Lawmakers also agreed to attach the Pathway to Job Creation through a Simpler, Fairer Tax Code Bill of 2012 (HR 6169 ), to HR 8 when both bills are enrolled and sent to the Senate. HR 6169 , which sets up an expedited process for passage of comprehensive tax reform legislation, will be considered by the House on August 2.

Republican lawmakers said HR 8 would extend tax relief for all Americans, especially those who create jobs, and give Congress time to pass comprehensive tax reform in 2013. House Speaker John Boehner, R-Ohio, noted that nearly two years ago President Obama refused to raise taxes even though the economy was in worse shape than today. Boehner said Democrats want to raise taxes on small business owners who pay taxes through their personal tax returns. “It’s clear that my friends on the other side are committed to raising taxes,” said Ways and Means Chairman Dave Camp, R-Mich. “Does anyone believe they will spend that on deficit reduction?”

Democratic lawmakers sought to portray HR 8 as a boon to wealthy taxpayers at the expense of middle-class taxpayers. Rep. Sander Levin, D-Mich., said that 97 percent of all taxpayers would keep their lower tax rates under an Democratic alternative measure. He said Boehner and House Republicans would be sacrificing middle-class tax relief to ensure than a few wealthy people would benefit. “The Republican bill is a path to nowhere,” Levin said.

The White House issued a veto threat against the GOP bill, saying President Obama would not sign HR 8 because it would add an additional $50 billion to the federal budget deficit by extending tax cuts to wealthier households. The GOP bill would add billions more to the deficit by extending tax cuts for the wealthiest estates, according to the Statement of Administrative Policy released by the Office of Management and Budget.

The House also voted down the amendment offered by Democrats that closely mirrored the Senate-passed Middle Class Tax Cut Bill (Sen 3412 ). House Minority Leader Nancy Pelosi, D-Calif., said, if the House had passed the Senate bill, it would have been signed into law by the president and would have stopped a tax increase on 25-million U.S. families. The Senate is unlikely to pass the GOP bill, thereby setting up a House-Senate conference, possibly during a lame-duck session held after the November elections.

By Stephen K. Cooper, CCH News Staff

Ways and Means Press Release: Camp Floor Statement on HR 8, Job Protection and Recession Prevention Act of 2012

Ways and Means Press Release: Levin Floor Statement Urging Passage of Senate-Passed Tax Cut Bill

 

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