House Passes Small Business Tax Credit Bill — President to Sign Monday
On Thursday, the House passed a $42 billion bill designed to provide tax credits and to make more capital available to small businesses. The bill was originally passed by the Senate last week and will be signed into law by the President on Monday. The “Small Business Jobs Act” is intended to make credit more available by authorizing the creation of a $30 billion fund run by the Treasury Department that would deliver low-cost capital to banks with less than $10 billion in assets. The bill also provides $1.5 billion in grants to state lending programs that in turn support loans to small businesses. The bill would also extend and/or create $12 billion in small business tax credits over the next ten years including a 100% exclusion of capital gains taxes on investments for qualifying C corporations, a five year extension of the “carry back” provision, an increase and extension through 2011 of Section 179 deductions for up to $500,000 worth of equipment, an extension of bonus depreciation for capital expenditures made in 2008 or 2009, and an increase to $10,000 in the deduction for start-up expenses for 2010.
Tax Cut Extension Vote Postponed Until After November Election
On Tuesday, Senate Majority Leader Harry Reid (D-NV) said he was “working hard for a vote most likely next week” on an extension of the Bush income tax income tax cuts for taxpayers making less than $250,000 per year. On Thursday, Reid and House Majority Leader Steny Hoyer (D-MD) announced the vote on the extension will be delayed until after the November elections. However, if Republicans take back the Senate and or the House, they could attempt to block that vote in the hopes of getting a more favorable bill early in the next Congress.
House Republicans Unveil “Pledge to America”
On Thursday, House Republican leaders unveiled their “Pledge to America” which details a series of policy proposals House Republicans will attempt to enact if they gain the majority in the November elections. The proposal includes promises to freeze federal government hiring, cut Congress’ budget, place hard caps on domestic spending accounts, extend the Bush tax cuts that are set to expire in 2011, and “repeal and replace” the new health care law.
Summers Announces Departure
On Tuesday, Larry Summers, the White House’s top economic adviser, announced he will leave at the end of the year and return to his position as a professor at Harvard University. Early speculation about Summers’ replacement has focused on Anne Mulcahy, the former Xerox chief executive, indicating the pick will likely come from the corporate not academic world.
House to Adjourn Next Week Until After November Election
House leaders are considering adjourning as early as the end of next week, which would give lawmakers five and a half weeks to campaign before the November elections. However, the scenario is dependent upon the Senate and House completing action on a stopgap spending bill to keep government agencies funded past the end of the current fiscal year on September 30 through the election. Speculation remains as to whether Senate Republicans may filibuster such a measure in the Senate in order to force the Democratic leadership to keep the Senate in session until an extension of the Bush tax cuts is passed.
Shelby Says Republicans Will Reopen Dodd-Frank Financial Reregulation Bill
On Monday, Senate Banking Committee Ranking Member Richard Shelby (R-AL) said that if Republicans take back a majority in the Senate, they will reopen the Dodd-Frank Wall Street Reform Act and overhaul the newly created consumer protection bureau. Under the newly-enacted legislation, banking regulators are stripped of their consumer supervisory duties and the new Consumer Financial Protection Bureau gains the power to write and enforce rules for mortgages, credit cards and other financial products.
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