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Senate 2008 Tax Rebate compared to House 2008 Tax Rebate Plan

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By boycottchapter27


Bush Tax rebate plan leading to Stagflation

Will the Bush Tax Stimulus Plan, plus the Bernanke Rate cuts lead to Stagflation?
Will the Bush Tax Stimulus Plan, plus the Bernanke Rate cuts lead to Stagflation?

The 2008 Senate Tax Plan vs. House Tax Rebate Plan

The Senate Thursday passed by an overwhelming margin an approximately $170 billion economic stimulus package.

Sen. Max Baucus said Democrats stripped down the stimulus bill to attract GOP votes.

The Senate accord -- reached after days of bickering and passed by 91-6 -- keeps the House-passed rebate check amounts of $300 to $600 for people who have an income between $3,000 and $75,000, plus $300 per child.

Couples earning up to $150,000 would get $1,200.

But the plan also gives checks to more than 20 million Social Security beneficiaries and 250,000 handicapped veterans and their widows.

"I'm very happy that the vast majority of the U.S. Senate agreed that we have to change the economic direction of this country, and we've done that," Senate Majority Leader Harry Reid, D-Nevada, told reporters.

But he expressed dismay that the package omits a number of provisions Democrats had sought, including an extension of unemployment benefits and checks for people aided by the food stamp program and the low-income home energy assistance program, measures that Senate Republicans and President Bush opposed.

"They're following this president right off a cliff," Reid said. "What they don't realize is he's already over the cliff."

Republican Leader Mitch McConnell of Kentucky said he was happy with the outcome: "I think we've demonstrated to the American people that we are, once in a while, able to come together and do something important to the country with a minimum amount of bipartisan bickering and do it in a timely fashion."

McConnell said the Senate bill also fixed a "glitch" in the House bill that would have made it possible for illegal immigrants to receive checks, too.

Senate Democrats agreed to scale back their economic stimulus package in order to gain Republican support for the measure.

The measured stalled Wednesday over GOP concerns that the bill was too big and loaded with special-interest provisions, Finance Committee Chairman Max Baucus said

Here we compare the major points in the proposed Tax Rebate Plan for 2008. The Bush proposal which has already been approved by the House and The Bill currently being considered for a Tax Rebate Plan in the Senate.

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What is Stagflation?

For information on Stagflation, visit our

What is Stagflation hub.

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Highlights of Rival Stimulus Bills

Key elements of rival economic stimulus bills, one passed by the House and the other a proposal by Senate Democrats:

TOTAL COST

House: $161 billion over two years.

Senate: $205 billion over two years.

TAX REBATES

House: At least $300 to almost everyone earning a paycheck, including low-income earners who make too little to pay income taxes, as long as they earned at least $3,000 in 2007. Social Security and disabled veterans benefits do not qualify as income. People paying income taxes could receive higher rebates of up to $600 per individual and $1,200 for couples. Families with children would receive an additional $300 per child. The full rebate would be limited to individuals earning $75,000 or less and couples with incomes of $150,000 or less, but a partial rebate would go to individuals earning up to $87,000 and couples earning up to $174,000. The caps are higher for people with children. Illegal immigrants are disqualified. Cost: $109 billion over 2008-2009.

Senate: $500 to almost everyone earning a paycheck, including low-income earners who make too little to pay income taxes, as long as they earned at least $3,000 in 2007. Social Security and veterans' disability income would qualify. Couples would get $1,000, and families with children would receive an additional $300 per child. The full rebate would be limited to individuals earning $150,000 or less and couples with incomes of $300,000 or less, but a partial rebate would go to individuals earning up to $160,000 and couples earning up to $320,000. The caps are higher for people with children. Members of Congress could not receive a rebate. To bar illegal immigrants from getting rebates, recipients and their spouses and children would have to have valid Social Security numbers. Cost: $126 billion over 2008-2009.

BUSINESS TAX WRITE-OFFS

House: Calls for "bonus depreciation" and more generous expensing rules to spur business investment. Cost: $51 billion in over 2008-2009.

Senate: Contains comparable provisions on business investment incentives, while also allowing businesses suffering losses now to reclaim taxes previously paid. Adds other tax breaks to boost renewable energy, including tax credits for energy-efficient businesses, appliances and homes. Coal companies could reclaim $300 million in export taxes they paid before 2000. Cost: $63 billion over 2008-2009.

HOUSING RESCUE

House: Allow more subprime mortgage holders to refinance into federally insured loans by raising the limit on Federal Housing Administration loans from $362,790 to as high as $729,750 in expensive areas. Increase the availability of mortgages by providing a one-year increase in the cap on loans Fannie Mae and Freddie Mac may buy, from $417,000 up to $729,750 in high-cost markets. No cost.

Senate: Identical provisions on FHA and Fannie Mae and Freddie Mac loan limits. Provides mortgage financing relief for homeowners with subprime loans by expanding the availability of state and local government bonds and raising the cap on the bonds by $10 billion over the next three years. Negligible cost.

UNEMPLOYMENT BENEFITS EXTENSION.

House: None.

Senate: Extend unemployment benefits by 13 weeks beyond the 26-week cap presently in place. Additional 13 weeks for unemployed people in states where the jobless rate has averaged 6.5 percent or more for three months. Cost: $15 billion over 2008-2009.

HOME HEATING SUBSIDIES.

House. None.

Senate. $1 billion in additional 2008 funds for heating subsidies for the poor.

Generally, I stray from talking politics since I know that somebody always gets offended and some people can't seem to remember it is a discussion where many times we all just have to agree to disagree, but that being said I am going to break my rule here.

I am not going to say whether the stimulus package is a good idea fiscally or not, but once the cat is out the bag so to speak the government needs to get moving on it. I find it utterly amazing that is now being argued over by senators all trying to get their way. Senators that are all generally making more than the average American and by no means need a stimulus rebate to help them. So they don't care how long they drag it out. It is amazing at what our politicians will argue over when it doesn't really personally help them. Bet they would get their raises voted on through in a hurry.

The sad thing is Americans voted these self serving people into office. Being a member of Congress should not be a career. When you make promises or committments to go to Washington and change things why should we allow them to have 10, 20, or even 6 years if they can't get the job done. How many of us would be allowed to keep a job if we didn't do what we were supposed to do? Same goes with the office of president. Thankfully, there are term limits on that position. ( And that in no means is a commentary on the current administration - just a statement for any administration)

With this being an election year, I would hope we would have come to our senses and started cleaning house, but from the candidates this year I can see that isn't the case. We have no one to blame but ourselves since we have allowed this long term "I promise to do - and then nothing gets done" mentality to create a sea of political apathy that covers this nation. How can we say we truly care when we keep voting the same people into office. The saying "if you do what you've always done, you will get what you always got", has never rung more true.

It doesn't matter which side of the aisle you are on, or whether you love donkeys, elephants or independents. I don't think anyone should tell you who to vote for, all I will say is don't just press a button or tap a computer screen unless you think real change is possible. And if the change doesn't happen, don't keep sending the same person back to Washington.

The fate of $600-$1,200 rebate checks for more than 100 million Americans is in limbo after Senate Republicans blocked a bid by Democrats to add $44 billion in help for the elderly, disabled veterans, the unemployed and businesses to the House-passed economic aid package.

GOP senators banded together Wednesday to thwart the $205 billion plan, leaving Democrats with a difficult choice either to quickly accept a House bill they have said is inadequate or risk being blamed for delaying a measure designed as a swift shot in the arm for the lagging economy.

The tally was 58-41 to end debate on the Senate measure, just short of the 60 votes Democrats would have needed to scale procedural hurdles and move the bill to a final vote. In a suspenseful showdown vote that capped days of partisan infighting and procedural jockeying, eight Republicans _ four of them up for re-election this year _ joined Democrats to back the plan, bucking GOP leaders and President Bush, who objected to the costly add-ons.

Democrats choreographed the vote for maximum political advantage, presenting their aid proposal as a take-it-or-leave-it proposition for Republicans and calling back their presidential candidates to make a show of party unity behind their stimulus plan. They calculated that Republicans would pay a steep price for opposing rebates for older Americans and disabled veterans, as well as heating aid for the poor, unemployment benefits and a much larger collection of business tax breaks than the House approved.

Even after their effort fell short Wednesday, Democrats seemed determined to keep the pressure on Republicans to accept the measure, threatening to hold more votes on it in the coming days.

Majority Leader Harry Reid, D-Nev., is "going to give Republicans a chance to reconsider their vote against efforts to strengthen the economy by helping those who need it most," his spokesman, Jim Manley, said Wednesday night.

Republicans said they were ready to accept rebates for seniors and disabled veterans and accused Democrats of delaying the stimulus plan for political gain and loading it down with special-interest extras.

"Our constituents will look at us as the folks that slowed it down (and) added a bunch of spending to it," said Sen. Jon Kyl of Arizona, the Republican whip, who called the measure "a Christmas tree package."

The White House, which has carefully avoided issuing threats about the package despite Bush's opposition to the add-ons, urged the Senate to move fast to approve a stimulus plan.

"To be effective, this economic growth package must be timely, so it is crucial that the Senate now move quickly to pass a bill that will deliver relief to our economy," press secretary Dana Perino said in a statement after the vote.

Democratic presidential candidates Hillary Clinton of New York and Barack Obama of Illinois flew to Washington for the vote. GOP front-runner John McCain of Arizona did not vote.

Supporters actually had 59 votes in favor of the Democratic proposal, but Reid switched his vote to 'no' at the last moment, a parliamentary move that allows him to bring the measure up for a revote.

Republican leaders objected to add-ons such as a $14.5 billion unemployment extension for those whose benefits have run out, $1 billion in heating aid for the poor and tax breaks for renewable energy producers and coal companies.

The measure builds upon a $161 billion House-passed bill providing $600-$1,200 checks to most taxpayers and tax breaks to businesses investing in new plants and equipment.

The Senate version would provide checks of $500-$1,000 to a broader group that includes 20 million elderly people, 250,000 disabled veterans and taxpayers making up to $150,000 for singles _ or $300,000 for couples.

It would extend unemployment benefits for an additional 13 weeks for those whose benefits have run out, with 13 more weeks available in states with the highest jobless rates. The bill also includes $10 billion in tax-free mortgage revenue bonds to help homeowners refinance subprime loans.

Reid denied Republicans an opportunity to offer changes to the measure, provoking the filibuster. The calculus was that enough Republicans would relent in the face of political pressure to support unemployment insurance and heating aid to join Democrats and force the measure through.

GOP leader Mitch McConnell, R-Ky., said he wants to amend the measure to add rebates for disabled veterans and their widows and the elderly, and language _ also included in the Democrats' package _ making clear that illegal immigrants can't get rebate checks.

"We didn't block the proposal," McConnell said. "We just said there's a better way to go and there's an alternative."

Reid rejected the offer _ at least for the time being _ but Republicans seemed confident he would eventually agree to comparable changes since the alternative would be to approve the House bill and leave retirees living on Social Security and disabled veterans without rebate checks.

The climactic vote came after an intense lobbying effort by Democrats to convert wavering Republicans, including those facing tough re-election fights. Their efforts got a boost from outside groups leaning on senators to back the package, including home builders, manufacturers and the powerful seniors lobby.

Republicans were under enormous pressure from their own leaders not to support the Democrats' plan. Working to stem defections, GOP leaders assured their rank and file that they would have another chance to support adding senior citizens and disabled veterans to the aid plan even if they opposed the Democrats' bill.

That wasn't enough for Sen. Pete Domenici, R-N.M. who threw his support behind the measure.

"I'm hopeful that I have chosen the right path," he said just before the vote. "I made my decision on what was best for New Mexico and what's best for America."

But other targets, such as Sen. John Sununu, R-N.H., stuck with McConnell.

Asked Tuesday whether the administration would accept adding rebates for the elderly and disabled veterans to the stimulus measure, Treasury Secretary Henry Paulson declined to say definitively, but he told the Finance Committee, "I'm sure we'll be able to work something out and get something quickly done that's broad-based."

The dispute has slowed down the stimulus measure, but there's no indication that it will delay rebate checks, which are expected to begin arriving in May. The rebates will be based on 2007 tax returns, which aren't due until April 15.

Comments

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Tim Hollis profile image

Tim Hollis  says:
2 years ago

They steal our money and give back some chump change.

Greg from Maine profile image

Greg from Maine  says:
2 years ago

If you read the fine print (I have an accountant that does), the "rebate" is actually a cash advance of your 2008 refund that you would receive in 2009 after you file your tax returns for the year 2008.

To further illustrate my point, if you were going to receive a tax refund check of $1,000 in the year 2009 after filing your taxes for the 2008 year by April 15, 2009, that refund that you would have received is going to be sent to you this year as a "rebate". Next year you will not receive a tax refund because it was sent to you this year.

99.999999% of the people are unaware of this fact. There will be a very upset public next year.....

maham profile image

maham  says:
2 years ago

nice hub

Tim Hollis profile image

Tim Hollis  says:
2 years ago

Greg. Thanks for pointing that out. It's like the minimum wage increase that turns out to be less than nothing. I'm from Maine also and my teachers taught us to question everything. Reid and Pelosi are also less than nothing.

Jeff  says:
2 years ago

http://www.cnn.com/2008/POLITICS/02/08/economic.st

There is a correction saying that it is not an advance.

Greg from Maine profile image

Greg from Maine  says:
2 years ago

Thanks Jeff, Ill look into it. I did notice that the correction states that "it will not be taxed." The correction doesn't specifically state that it isn't a rebate. What is or isn't said in a news article is simply a matter of the opinion of the author of the article. I'll check into the source to find the real info.

FaireMaid profile image

FaireMaid  says:
2 years ago

Every year aound this time I ask myself, 'Why not a flat tax?"

PCaholicDotCom profile image

PCaholicDotCom  says:
2 years ago

LOL Love the video below... "..I can't buy a PS3 and a couple of games... for $600!?"

Peter

Sharon   says:
2 years ago

I don't think it is fair that US citizen on SS @ SSI We all pay taxes We should get the Tax rebate

subprime crisis  says:
15 months ago

taxes is the biggest american lie. please watch de excellent documental entitled> Money as debt

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The 2008 Bush Tax rebate stimulus program - Wolverine

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