Month: February 2009

Poorest 60% of Taxpayers Get No Benefit from Reduction in Alternative Minimum Tax Included in Senate Stimulus Bill

Posted on by Alex Welch

February 11, 2009 12:29 PM | | Bookmark and Share

The economic stimulus bill that the Senate approved yesterday includes several tax cuts that
are not in the stimulus bill approved by the House of Representatives two weeks ago. Among
these, there is one that stands out as particularly expensive and unlikely to stimulate the
economy — the Senate’s proposed one-year reduction (or “patch”) for the Alternative
Minimum Tax (AMT).

This provision, which costs $70 billion, would prevent the Alternative Minimum Tax (AMT)
from expanding its reach to tens of millions of families who have previously been unaffected
by it, for one year. This might sound like a nice idea for some taxpayers, but as economic
stimulus it would be ineffective because almost 70 percent of the benefits would go to the
best-off ten percent of taxpayers.

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The Six Worst Tax Cuts in the Senate Stimulus Bill

Posted on by Alex Welch

February 10, 2009 02:31 PM | | Bookmark and Share

The economic stimulus bill that the Senate approved today includes several tax cuts that are not in the stimulus bill approved by the House of Representatives two weeks ago and which should be excluded from the final bill that goes to the President.

The bill approved by the House of Representatives two weeks ago has a total cost of about $819 billion, while the cost of the Senate bill had grown last week to about $940 billion. A group of self-styled centrist Senators then put forth a compromise that took exactly the wrong approach to cutting down the costs: They mostly removed government spending that economists believe will stimulate the economy — like aid to state governments, school construction, food stamps — while they left in most of the regressive tax cuts that Senators have added to the bill.

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