Consumer Law

House approves bill to tax AIG bonuses and others

By Kia Franklin

From AP:

Acting swiftly, the Democratic-led House approved a bill Thursday to slap punishing taxes on big employee bonuses at firms bailed out by taxpayers. The bill would impose a 90 percent tax on bonuses given to employees with family incomes above $250,000 at American International Group and other companies that have received at least $5 billion in government bailout money.

"We want our money back now for the taxpayers," House Speaker Nancy Pelosi said.

DMI's TheMiddleClass.org, known for its instant analysis of legislation and how it affects the middle class, had this to say about the new bill:

H.R.1586 should be unnecessary. Congress had ample opportunity to ensure that inappropriate bonus payments were not paid to employees of firms supported by taxpayer dollars. Indeed, in practice the legislation only recaptures taxpayer money, which itself expends additional IRS resources and occupies time better spent by Congress addressing the housing crisis, health care reform, and climate change. The type of ad hoc, retroactive legislation characterized not only by H.R.1586, but by the Emergency Economic Stabilization Act, calls into question Congress?s commitment to smart, long-term, sustainable investment and to real accountability with consequences for inappropriate behavior. The economic crisis demands flexibility and creative solutions to unexpected challenges. However, payment of bonuses was not only foreseeable, but legislation to prevent it was proposed. Congress must redouble its efforts to provide the accountability H.R.1586 offers before the middle-class taxpayer is put at risk.

Full post as published by TortDeform.com on March 19, 2009 (boomark / email).