February 11, 2009 12:29 PM | Permalink | 
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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