House and Senate Ready to Vote on Tax Plan

House and Senate Republican leaders reached agreement on a tax plan Wednesday afternoon. Now the plan heads to the floors of both legislative chambers for a full vote.

The bill, which is expected to cut taxes by $350 billion over a 10-year period, faces a close vote in the Senate where Vice President Dick Cheney is expected to be called upon to break a 50-50 tie. While some Senate Democrats have endorsed the plan, notably Senators Ben Nelsen (D-MD) and Zell Miller (D-GA), some Republicans have broken with the party on this vote.

Senators John McCain (R-AZ) and Lincoln Chafee (R-RI) have denounced the tax cuts saying they can't support the cuts in a year when the federal deficit is expected to exceed $300 billion. Senator Olympia Snowe (R-ME) is also expected to vote against the bill.

For the most part, Democrats have criticized the tax bill claiming it favors the rich and will add to the national debt. "It gives away billions to those who need it least and does very little for those who need it most," said Senate Minority Leader Tom Daschle (D-SD).

Details of the bill will be hammered out as the House and Senate enter their debate sessions, but expectations are that the final tax bill will contain provisions such as the following:

  • Reduction in regular income tax rates

  • Reduction in tax rates on capital gains and dividends

  • Increase in child tax credit

  • Reduction of the so-called marriage penalty

  • Increase in the amount of equipment costs that small businesses can deduct each year

  • Funding for state Medicaid and other programs

Both the House and Senate have agreed that they want to deliver a final version of the bill to President Bush before leaving Washington D.C. this weekend for their Memorial Day recess.

You may like these other stories...

Renaissance avoided more than $6 billion tax, report saysThe Senate Permanent Subcommittee on Investigations said on Monday that a Renaissance Technologies LLC hedge fund’s investors probably avoided more than $6...
A new Gallup survey found that 58 percent of smokers in the United States see increased state and federal taxes on cigarettes as an act of unjust discrimination, while 39 percent believe the tax hikes are justified.The...
Liberal groups object to bill barring taxes on Internet accessThe Internet Tax Freedom Act hasn’t been a controversial bill. In fact, it’s so popular that senators are seeking to pair it up with a far more...

Upcoming CPE Webinars

Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.
Jul 31
In this session Excel expert David Ringstrom helps beginners get up to speed in Microsoft Excel. However, even experienced Excel users will learn some new tricks, particularly when David discusses under-utilized aspects of Excel.
Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.