Mike Thompson United States Congressman - First District of California
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Thompson: “Quickly Pass” Executive Bonus Legislation

March 18, 2009

WASHINGTON- Today the Ways and Means Committee introduced legislation to tax bonuses given by companies such as AIG that received government rescue funds.  

“It goes against the ideals of capitalism to reward the people that helped create this economic mess,” said Congressman Mike Thompson (D-CA).  “It’s even more outrageous that taxpayers are footing the bill.  Congress should quickly pass this legislation that will effectively eliminate the bonuses being paid out by companies who received help from the government.”

The legislation introduced today by the Ways and Means Committee will tax bonuses from companies that received $5 billion or more in TARP funds at 90% for individuals who earn over $250,000 per year.  Currently, the IRS withholds 25 percent from bonuses less than $1 million and 35 percent for bonuses more than $1 million dollars.  House leaders have indicated that passing legislation to address the bonuses will be a high priority for Congress this week.

Yesterday, Congressman Thompson introduced H.R. 1572, the “Taxpayer Protection Act,” which would subject any entity that received assistance under the Emergency Economic Stabilization Act of 2008 to a bonus tax rate of 90 percent, with no exemptions.

Congressman Thompson is a senior member of the Ways and Means Committee, which has jurisdiction over all tax-related matters coming before Congress.

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