House approves Bush Tax Cuts for wealthy, Pelosi reacts

[Bush_Eats_Beef]

House Approves $56.6 Bln Tax Measure Extending Dividend Rate

Dec. 8 (Bloomberg) -- The U.S. House passed a $56.6 billion budget measure that extends past 2008 a 15 percent tax rate on dividends and most capital gains.

The House voted 234-197 to extend for two years the 15 percent rate on dividend and capital-gains taxes that was slated to expire in 2008. Republicans credited President George W. Bush's 2003 tax reductions on investments with boosting the stock market and the economy. ``These tax cuts have indeed done what the president said they would do,'' said Louisiana Representative Jim McCrery, a senior Republican on the House Ways and Means Committee. House Speaker Roy Blunt, a Missouri Republican, urged lawmakers to ``keep the structure that's growing this economy in place.''

The vote today sets up a conflict with the Senate, which has approved legislation devoted to limiting the alternative minimum tax without extending the investment tax breaks. Republicans must now find a way to pass final legislation that combines the extension of investment tax breaks and a measure to spare 15 million Americans, most of whom earn between $100,000 and $500,000, from a $30 billion increase in the minimum tax next year. Enacting both provisions would add about $100 billion to the national debt over the next five years. A budget agreement passed in April authorizes only up to $70 billion.

House Minority Leader Nancy Pelosi, a California Democrat, accused Republicans of preserving tax cuts for the richest 1 percent of American earners after reducing the growth of spending programs for low-income people such as food stamps and putting the alternative minimum tax legislation at risk. ``The poor suffer, the rich benefit, and the middle class foot the bill,'' she said.

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