WASHINGTON – The Republican-controlled US House of Representatives has passed a tax break for small businesses, giving voters a stark alternative to US 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 per cent 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 yesterday on a mostly partisan 235-173 vote.
Democrats criticised the Bill because it did 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,” Sandy Levin, the senior-most Democrat on the tax-writing House ways and means committee, said.
Mr 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,” he said. “We should not be taking money out of those we need to create jobs.”
With both parties eyeing the November 6th elections, Senate Republicans on Monday blocked a measure that would have imposed a 30 per cent minimum tax on households that earn more than $1 million (€761,000) a year.
It was championed by Mr Obama and multibillionaire Warren Buffett . – (Reuters)