House leaders reject Senate’s AMT fix

Despite the Senate’s overwhelming vote to pass an Alternative Minimum Tax (AMT) patch without offsets, House leadership officials Friday indicated they will continue to press the upper chamber to pass a measure that is paid for.

Stacey Bernards, spokeswoman for House Majority Leader Steny Hoyer (D-Md.), said Hoyer “has said repeatedly he will not vote for an AMT bill that is not paid for. I also expect the House to send back to the Senate a responsibly paid-for bill in response to what they passed [Thursday].”

{mosads}Senate Democrats have tried to pass an AMT patch that would shield 19 million to 23 million taxpayers from the tax, which hits middle- to upper-class households. But Republicans have balked at the offsets, noting that the AMT tax was crafted to hit only wealthy families and has spread to taxpayers it never was intended to affect.

Senate Democratic leaders, fearful of a public backlash if they didn’t pass the AMT fix, reluctantly agreed Thursday to waive pay-as-you-go rules and passed their measure 88-5. Senate Budget Committee Chairman Kent Conrad (D-N.D.), an outspoken proponent of pay-go, voted no.

After being on the defensive on reauthorizing the State Children’s Health Insurance Program for the last couple of months, Republicans are now on offense on AMT.

One hour after the Senate passed its bill, House Minority Leader John Boehner (R-Ohio) issued a release stating that that “Only House Democratic leaders stand in the way of protecting 23 millions taxpayers from a massive tax hike.”

GOP officials say that Democrats are facing a no-win situation: They will either waive pay-go and be exposed to criticism for abandoning their commitment to fiscal discipline or face a public-relations nightmare that could threaten their majority in Congress.

Senate Majority Leader Harry Reid (D-Nev.) accused Republicans of playing politics with AMT earlier this week. In a Dec. 4 floor speech, Reid said, “[President Bush] is giving speeches all over the country. He gives press conferences talking about why we aren’t doing AMT. Everybody watch. Here is why we aren’t doing AMT: They do not want us to do it. They want, at the end of the year, to say, ‘Look, the Democrats are not doing AMT.’ ”

House Speaker Nancy Pelosi (D-Calif.) Thursday reiterated her commitment to pay-go: “On the AMT, as you know, we are committed to pay as you go.” She floated the possibility of using other sources of revenue to pay for AMT, but Senate Republicans have rejected that offer.

The Blue Dogs, a group of centrist and conservative House Democrats, have been pressing Pelosi not to waive pay-go.

House Ways and Means Committee Chairman Charles Rangel (D-N.Y.), who crafted the lower chamber’s AMT patch, has also rejected all notions of waiving pay-go rules. He recently told The Washington Post, “From the House point of view, that’s unacceptable.”

During the debate on the House-passed AMT bill, Hoyer said, “Will there be an offset? There will be. And, as I said, I will not vote to fix the AMT unless we pay for it.”