Vote on tax cuts coming today
The House of Representatives will vote today on extending tax cuts for the lower and middle class, but not on cuts for Americans with higher incomes, which includes many small business owners that file as a sole proprietor or S-Corp:
House lawmakers will vote Thursday morning on whether to extend the Bush-era tax cuts for the middle class – leaving the feud over whether to do the same for wealthy Americans up in the air.
“I’m hopeful that we will able to pass that bill unanimously because the American public wants us to find places for agreement,” the House majority leader, Representative Steny H. Hoyer of Maryland, said on Wednesday. “It is a shame that what we have agreement on is being held hostage by that on which we do not agree.”
Mr. Hoyer has the votes, but the bill has virtually no chance in the Senate. Republican senators have pledged to halt all lame-duck legislative activity until an agreement is reached on the tax cuts and on funding for the government.
All sides are promising to hold firm on their positions - though surveys indicate that Democrats are divided on this issue - with incoming Majority Leader Eric Cantor (R-VA) promising that House Republicans would not support anything other than extension of all tax cuts:
The White House can offer any compromise it likes, but GOP congressional leaders would be wise to not accept any compromise. Republicans have all the leverage they need to get full and permanent extension of all the tax cuts. If the Democrats balk, they will be viewed as obstructionists who are going to increase taxes not just on high-income earners, but on all taxpayers.
If all tax rates go up on January 1 because of the Democrats’ contempt for “rich” people, the new GOP-controlled House can submit a bill to the Senate for full and permanent extension of the tax cuts retroactive to the beginning of the year so no taxpayer ultimately plays for the Left’s class warfare tactics. If the Senate refuses to pass the House bill, it will only worsen their image (and the White House’s image) in the eyes of the American public.
Bottom line: GOP leaders should demand NO COMPROMISE. They hold all the cards.
I do think that in the end some compromise will be reached, likely temporary extension. But like I said yesterday, if they can’t agree to repeal the onerous 1099 provision in ObamaCare, which failed again on Monday, I don’t know that I should hold my breath on both sides being able to come to agreement in holding off these job killing tax hikes.