U.S. Representative Sandy Levin
12th District of Michigan

(Washington D.C.)- {U.S. Rep. Sander Levin (D-MI), a senior member of the House Ways and Means Committee, today spoke on the House floor about Republican choices: House Republicans want to award additional tax cuts for the very rich over the needs of working families. Mr. Levin opposed the $56 billion Republican Tax Reconciliation Act, which includes $21 billion in extension of the capital gains and dividend tax cuts for the very wealthy. Today’s passage, in a vote of 234 to 197, of the Republican tax cuts occurred three weeks after the House approved $50 billion in cuts to student loans, child support enforcement, food stamp assistance, and health care for children, the elderly and disabled. 

“What are the choices of the Republicans?” asked Rep. Levin. “First, they want to extend the capital gains and dividend tax cuts even though they already continue through to 2009. Secondly, they chose to slash funding from student loans and child support enforcement to pay for these tax cuts. Finally, the Republicans chose to leave out of this bill relief from the Alternative Minimum Tax (AMT). The choice is clear: the Republican-controlled House would rather provide tax relief to those people making over a million dollars a year rather than millions of working families.”

Although Republicans claim their budget measures will help pay for the deficit and offset the costs of Hurricanes Katrina and Rita, the reality is the Republican plan will lead to an increase in the deficit and does nothing to cover the costs of the recent Hurricanes. The capital gains and dividend tax cut extensions will continue to add to the deficit, having long-term economic consequences. Under the Republican plan, the wealthiest of Americans making over one million annually stand to gain an average cut of $32,000 per year, while working families, earning less than $40,000, minimally gain around $7 per year.

 “Our approach sets different priorities: the AMT is set to hit millions of Americans next year. Democrats proposed providing AMT relief to working families, but the Republicans left it out of their bill,” concluded Levin. 

Through a political maneuver, the Republican-controlled House yesterday debated and passed a stand alone AMT tax relief bill that has no possibility of passage in the U.S. Senate. The Democratic plan would have provided AMT relief for couples earning less than $200,000 per year. The AMT will hit 3.5 million taxpayers this year and affect 19 million Americans next year, primarily targeted at the middle-class. More than half of all couples with two kids and incomes between $75,000 and $100,000 will have to pay AMT next year. However, the AMT does not hurt the very rich having virtually no impact on individuals making $500,000 or more a year.

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