Congressional GOP pushes for action on taxes

AP News
Posted: May 17, 2012 6:27 PM
Congressional GOP pushes for action on taxes

Republican lawmakers intensified their efforts on Thursday to get quick congressional action on heading off automatic tax increases and revamping the federal tax code.

In a letter to Senate Majority Leader Harry Reid, D-Nev., 41 Senate Republicans said they wanted a vote this summer _ before the November elections _ on preventing tax increases that will take effect Jan. 1 unless Congress acts. Those increases would be a result of the expiration of tax cuts enacted under President George W. Bush and would affect people across all income levels.

"The time to begin is now. Inaction is irresponsible," said the letter, which was led by Sen. Orrin Hatch of Utah, top Republican on the Senate Finance Committee.

Reid has shown little appetite for letting tax rates fall for the wealthiest Americans and in recent months has staged votes on bills that would raise taxes on them instead.

Separately, House Ways and Means Committee Chairman Dave Camp said Thursday that he wants to combine a push to head off those tax increases with enactment of procedures that would force Congress to revamp the entire tax code next year.

"Doing so would send a clear, strong message to the markets, to employers and families that Washington is serious about reforming our tax code and putting us on a path to sustained economic growth," said Camp, R-Mich.

Republicans want to prevent tax increases for all taxpayers, while President Barack Obama and congressional Democrats prefer letting tax rates rise for the highest-earning Americans.

House Speaker John Boehner, R-Ohio, said this week that he plans to have a pre-election vote on heading off the automatic tax increases. That measure would likely go nowhere in the Democratic-led Senate.

Even so, Republicans hope that such a vote would give them a chance to demonstrate their support for tax cuts during the run-up to this year's presidential and congressional elections. Most Democrats would be likely to oppose such tax cuts unless the wealthy were excluded from them.

The six GOP senators who did not sign the letter to Reid include two facing tough re-election fights this year, Scott Brown of Massachusetts and Dean Heller of Nevada.

It would cost the government an estimated $5.4 trillion over the coming decade to renew the Bush tax cuts, extend a temporary reduction in the alternative minimum tax and this year's Social Security payroll tax cut, and keep alive a collection of other expiring tax breaks.

A big, expensive collection of budget events will also occur in January, including the start of $1.2 trillion worth of spending cuts and the expiration of this year's Social Security payroll tax cut. In addition, the government's borrowing authority is expected to expire around that time.

That confluence of events has fed expectations of a frantic postelection lame-duck session of Congress to address those issues, though many expect final decisions to be postponed until next year.