$44 Billion in Tax Breaks and a QB Sneak

In the early morning hours on Saturday, the Senate voted 79-9 to combine and adopt two House bills in a sprawling $45.1 billion tax, trade, energy, and health package entitled the Tax Relief and Health Care Act of 2006." The final version of the bill differed little from the version summarized here. The $35.9 billion in tax break extensions includes the following major provisions (costs of two-year two extensions -- covering 2006 retroactively and 2007; five-year costs indicated by *):
  • R&D tax credit -- $16.5 billion
  • State and local sales tax dedecution -- $5.5 billion

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Speaker-Elect Pelosi to Push Worker Rights in '07

Tracking inversely with income inequality over the past 20 years has been the rate of union membership among American workers. From a peak of 20.1% in 1983, the unionization rate has fallen to 12.5% in 2005 (the latest year for which the latest data are available). In addition to this correlation are empirical data which show that declining union membership explains 15-20% of the increase in income inequality for males.

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Pre-PAYGO Patch Fails on 205-207 Vote

This afternoon, the House defeated, 205-207, an amendment by Rep. Edward J. Markey (D-MA) to require oil companies with royalty-free offshore leases to renegotiate those deals before winning new leases in certain areas. Rep. Charles Rangel (D-NY), the House Ways and Means ranking Democrat, had added language to the amandment, CQ ($) reports "to allow a 2007 “patch” for the alternative minimum tax that would have cost $48 billion."

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House Extends Oversight of Iraq Reconstruction Funds

In a stroke of good judgment, the House has decided that oversight of $38 billion in Iraq reconstruction funds is, in fact, something that should be conducted beyond next year. CQ (no link): The House by voice vote cleared S 4046, to extend the term of a special inspector general for Iraq reconstruction until 10 months after 80 percent of Iraq reconstruction funding has been spent -- a threshold expected to be reached in late 2008. A provision of the fiscal 2007 defense authorization law set Oct. 1, 2007, as the end of the inspector general's term.

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Another Day, Another Deregulation

On November 21, EPA issued a final rule that absolves pesticide users from obtaining a permit to apply pesticides over or near bodies of water. Today, the Detroit Free Press ran a Gannett News Service story about the ruling, which has been woefully undercovered in the media. The story also has a nice sidebar encapsulating some of the Bush administration's most objectionable deregulation decisions over the past six years; not to mention a pithy quote from OMB Watch Executive Director Gary Bass:

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New FAQs On Exempt Groups

On December 5, the Internal Revenue Service (IRS) released a new set of frequently asked questions for exempt organizations. The FAQs include answers such as where complaints about the activities/operations of tax-exempt organizations should be sent and whether contributions are deductible while an organization's application for tax exemption is pending. The new FAQs are available here.

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New Means to Enforce Church Politics

Attorneys Marcus S. Owens and Natalie E. Fay wrote an article titled, "Penalizing Instigators of Political Campaign Intervention." The authors suggest that in light of increased attention on IRS audits of tax-exempt groups who have engaged in campaign intervention, the IRS should redirect enforcement measures to the candidates who in fact encourage the misuse, particularly of churches. Owens and Fay describe how candidates entice a church's involvement through various examples, such as candidates who have openly included churches in their campaign strategy, leaving the churches vulnerable.

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Perverse Priorities in the Tax Extenders Package

Though popular, the tax extenders package that seems headed for approval today is not without its perverse aspects. For instance, a funding patch for the State Children's Health Insurance Program (SCHIP) was stripped out of the package, at the same time that funding for Health Savings Accounts (HSA) was added. SCHIP benefits low-income children- HSAs the wealthy and privileged. For more, see this statement by Robert Greenstein of the Center on Budget and Policy Priorites. It has been known all year that without additional SCHIP funding, 17 states would face SCHIP

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Plans to Probe Privacy Issues

This New York Times article reports that Democratic leaders want to conduct increased oversight of counterterrorism programs, including wiretapping and data-mining programs. Senator Leahy made this opinion clear during a hearing yesterday questioning Robert S. Mueller III, director of the FBI. These investigatory plans are very encouraging.

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Tax Package -- Almost a Wrap

As business draws to a close on the penultimate day of the 109th Congress, House and Senate negotiators have substantially agreed on the terms of a tax extenders package. Cost: $45 billion over 10 years. The package features a broader array of tax break extensions and modifications than had been part of the package in the reconciliation, pension, and trifecta bills earlier in the year (the largest element of which is the R&D credit, at $16.5 billion). Cost: $35.9 billion It also includes:

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