BNA Daily Tax RealTime Update ran the following story this afternoon:
Senate Passes 2009 Budget Plan GOP Assails as Massive Tax Increase
The Senate, on a narrow, mostly party-line vote, adopted a 2009 budget plan that Democrats said leaves open the possibility of extending some of President Bush’s 2001 and 2003 temporary tax cuts, but that Republicans said will lead to a large tax increase. The conference report for the 2009 budget resolution (S. Con. Res. 70) was adopted 48-45, with two Republicans, Sen. Susan Collins (R-Me.) and Sen. Olympia Snowe (R-Me.) joining Democrats and one Independent in favor of the largely non-binding plan. One Democrat, Sen. Evan Bayh (D-Ind.), joined Republicans in opposing the plan. The House is expected to vote on the report June 5.
There will be no tax increase – just the sun-setting of the 2001 and 2003 tax shifts. Now George W. Bush likes to claim he cut taxes but he didn’t. His Administration saw government spending go up and there are no serious proposals from his party to significantly cut government spending over the future. Anyone who understands the long-run government budget constraint recognizes that the reversal of these temporary tax “cuts” is inevitable. Therefore, this is not a tax increase. And in the interest of being bipartisan – let me suggest that Senate Democrat Evan Bayh should be ashamed of himself.