House passes tax breaks to help small businesses
WASHINGTON — The House passed a pair of bills last week containing tax breaks for small-business owners and a new fund to encourage banks to lend them money.
Democrats said the measures were part of their economic recovery agenda. Republicans called them more potentially wasteful bailouts.
A bill that passed 241-182 would create a $30 billion fund for increased lending to small businesses. Supporters said the funds could be leveraged into $300 billion of loans directed through community banks and banks that have high rates of lending to farm and small businesses.
Some $2 billion would help states in their own efforts to boost small businesses.
“We need new ways of meeting businesses’ capital needs,” said Rep. Nydia M. Velazquez, D-N.Y., chairman of the House Small Business Committee.
Republicans likened the bill to the Troubled Asset Relief Program that aided teetering financial institutions during the 2008 financial crisis. They said there was no guarantee that lending will increase.
“It’s really just another bank bailout,” said Rep. Virginia Foxx, R-N.C.
The vote fell largely along party lines, except for three Republicans who voted for the bill and 13 Democrats who voted against it.
Rep. Shelley Berkley, D-Nev., voted for the bill. Rep. Dina Titus, D-Nev., and Dean Heller, R-Nev., voted against it.
A second bill, which passed 247-170, contained tax breaks that Democrats said would bolster the small-business sector. It would temporarily eliminate capital gains taxes on some investments, and allow more generous deductions for business startups in their first year.
The bill would cost $3.6 billion over 10 years. At the same time, it would increase revenues by $7.1 billion through provisions that sponsors said would close loopholes in the estate tax.
Republicans said the tax breaks were not enough and would do little to create jobs.
Berkley and Titus voted for the bill. Heller voted against it.
Health Care Mandate Supported
In what Republicans billed as the first challenge to the newly enacted health care law, the House voted 187-230 to keep in place the requirement that virtually all Americans will have to buy health insurance or pay a penalty.
The coverage mandate that goes into effect in 2014 was one of the more controversial parts of the health care law.
Critics, mostly Republicans, say it is unconstitutional to force people to buy health insurance.
Supporters, mostly Democrats, say it is necessary to bring more consumers into the health system in order to spread the costs of providing coverage to 32 million people without insurance now.
A Republican motion to roll back the mandate was killed on a largely party-line vote. Twenty-one Democrats voted to eliminate the requirement.
Heller voted to roll back the health care mandate. Berkley and Titus voted against the rollback.
Deadline extended for tax credit
The Senate voted to extend the deadline for homebuyers to complete their purchases in order to quality for a popular tax credit.
An amendment by Sen. Harry Reid, D-Nev., moves from June 30 to September 30 the deadline for buyers to close on their new homes in order to claim a credit of $6,500 or $8,000.
An estimated 180,000 purchasers met an April 30 deadline to have a home under contract but face delays in wrapping up the transaction.
The $140 million cost of Reid’s amendment would be offset by eliminating a tax break that allows businesses to write off punitive damages in lawsuits they lose. Republicans said they preferred using unspent stimulus funding to offset the cost.
The Reid amendment was passed, 60-37. Sen. John Ensign, R-Nev., joined Reid in voting for it.
In another nod to homebuyers, senators voted 63-33 to create an Office of Homeowner Advocate that would help people who lose their homes because of mistakes by banks that participate in government mortgage rescue programs.
Reid voted for the amendment. Ensign voted against it.
Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or 202-783-1760.
