Rebels Emerge In Tax Votes
WHEELING – Sen. Joe Manchin voted against a Democrat bill to cut taxes Thursday, noting “not one cent of that short-term gimmick is paid for.”
The measure was rejected by a vote of 53-44, failing to get the 60 “yes” votes needed for passage. The West Virginian was the only Democrat to vote “no” on the measure.
The Senate also rejected a rival GOP bill 73-24 minutes later, with 21 Republican senators – nearly half – voting against it. Among those senators was Ohio’s Rob Portman, along with the Democrat senators from West Virginia and Ohio.
Called the Small Business Jobs and Tax Relief Act, the Democrats’ legislation would have given employers a 10 percent tax credit – up to $500,000 – for increasing their payrolls over last year. Firms also could have deducted the entire cost of capital expenditures this year, doubling the current 50 percent deduction available.
“This bill might sound like a good idea, but the fact is that it won’t create jobs and it adds too much to our deficit … ,” Manchin said. “I believe in helping our small businesses create jobs, but this bill doesn’t guarantee that businesses will hire any additional employees or that any new employees will keep their jobs over the long term. Worse still, not one cent of that short-term gimmick is paid for.”
Portman also voted against the Democrats’ bill, while Democrats Jay Rockefeller of West Virginia and Sherrod Brown of Ohio voted in favor.
Overall, the measure had a 10-year price tag of $29 billion.
“Small businesses are the backbone of our economy,” Rockefeller said. “By incentivizing them to expand, we’re building our economy and helping more people get good-paying jobs. This bill contains important reforms that we should all agree on – tax cuts for pay raises, hiring and spending on new equipment that will make it easier for small businesses to succeed and strengthen economic recovery, without having any of those tax cuts go to wealthy Americans.”
The GOP plan was approved by the Republican-led House in April and would cost $46 billion. It would give 20-percent tax deductions to all businesses with fewer than 500 workers – a figure that Census Bureau data shows covers more than 99 percent of all American firms.
On the other hand, companies with fewer than 500 workers employ just over half the nation’s 121 million workers, the census numbers showed. Republicans argue that cutting taxes would free up money to hire people.
Democrats said that because the GOP bill’s tax cuts were only based on the number of workers, many of the reductions would end up going to hedge funds and other profitable companies that don’t need tax relief at a time of huge federal deficits.