House Vote Expected Thursday on Bush Tax CutsAugust 1, 2012
The House is expected to vote Thursday on the Republican proposal that would extend for one year all expiring Bush-era tax relief provisions for taxpayers at all income levels and provide a timeline and expedited procedure for moving comprehensive tax reform legislation through Congress in 2013.
The House Rules Committee met on Tuesday to consider debate rules for the legislation, H.R. 6169, the Pathway to Job Creation through a Simpler, Fairer Tax Code Act of 2012 and H.R. 8, the Job Protection and Recession Prevention Act of 2012.
The House also will vote on a Democratic substitute offered by Ways and Means Committee Ranking Member Sanders Levin (D- Mich.) that would allow the current income tax rates to expire for taxpayers earning income in excess of $250,000 for couples ($200,000 for singles), while extending for one year—through 2013—most of the current expiring Bush-era tax provisions such as: marginal rate reductions, capital gains and dividend rate preferences, alternative minimum tax relief, marriage penalty relief, and expanded tax relief for working families with children and college students.
H.R. 8 would extend for an additional year, through 2013, the Bush-era tax reductions originally enacted in 2001 and 2003, and set to expire at the end of this year. According to Camp, this extension serves as the bridge to tax reform in 2013 and would: lower marginal rates, continue the marriage penalty relief, maintain the $1,000 child credit, uphold a 15 percent top rate on dividends and capital gains, repeal Personal Exemption Phase-out (“PEP”) and the Pease Limitation.
Additionally, the measure will keep the estate tax at its 2011 and 2012 parameters—set at 35 percent and the exemption amount at $5 million (indexed for inflation), increase Section 179 small business expensing limits, and provide a two-year Alternative Minimum Tax (AMT) patch (covering 2012 and 2013), preventing the AMT from expanding its reach to millions of additional taxpayers.
Based on an estimate from the Joint Committee on Taxation, the measure would prevent taxes from rising by $384 billion over a 10-year period. However, most Democrats in both Chambers are opposed to extending the tax cuts for upper-income taxpayers who earn more than $200,000 for individuals and $250,000 for families.
Ways and Means Committee Chairman Dave Camp (R-Mich.) and Committee on Rules Chairman David Drier (R-Calif.) introduced H.R. 6169, a measure that spells out principles of tax reform which reflect those adopted in the last two House-passed budgets. The measure also establishes an expedited process for tax reform in 2013 that will direct the committees of jurisdiction to consider and act on comprehensive tax reform next year. The bill is intended to provide a clear pathway to comprehensive tax reform by implementing procedures that will enable lawmakers in both the House and Senate to overcome multiple technical hurdles that often cause bills to languish during the legislative process.
Both sides of the aisle agree that real, fundamental reforms to our tax code are long overdue and, while comprehensive tax reform is difficult to achieve, this proposal provides a step-by-step process. In the House, if the Rules Committee fails to provide for consideration of an applicable tax reform bill within 15 days after the Ways and Means Committee reports the tax reform bill or is discharged, a process for floor consideration of the bill, similar to an open rule, will automatically be put in place. In the Senate, any applicable tax reform bill would not be subject to a cloture vote on a motion to proceed or on individual amendments. A cloture vote may still be required to end debate of the bill. The expedited procedures also require that amendments be relevant to the underlying bill.
NSBA is urging small-business owners to call their Representatives today and urge their support of the proposal.
Read the full bill text for H.R. 6169 here.