Senate overwhelmingly agrees to advance $858B tax package

story by The Hill
written by Alexander Bolton

Senate Democrats and Republicans joined together Monday afternoon to advance an $858 billion package of tax cuts and benefits, setting up a political showdown with the House.

As of 5:10 p.m., the vote count was 79-10 to move forward with the package. The overwhelming vote gives the package some momentum as it appears headed to the House, where liberals oppose the measure for extending tax breaks for the rich.

President Obama hailed the Senate vote before it was gaveled closed, stating that it showed the two parties could work together.

The 10 seven lawmakers voting to sustain a filibuster were Sens. John Ensign (the only Republican) (Nev.), Kay Hagan (D-N.C.), Carl Levin (D-Mich.) Bernie Sanders (I-Vt.), Jeff Bingaman (D-N.M.), Mark Udall (D-Colo.), Patrick Leahy (D-Vt.), Kirsten Gillibrand (D-N.Y.), Russ Feingold (D-Wis.) and Sherrod Brown (D-Ohio).

Senate Majority Leader Harry Reid (D-Nev.) plans to keep the vote open for up to several hours to give lawmakers whose flights have been delayed by snowy weather a chance to register their votes later Monday afternoon.

Having secured the 60 votes necessary to end a filibuster, Reid could bring the package up for a final vote as soon as Tuesday. The timing of final passage will depend on when the last lawmaker votes on Monday and whether opponents will agree to waive procedural rules.

A Democratic aide cautioned that a final vote could get pushed to Wednesday.

Reid has overcome the tougher hurdle of ending the filibuster and will easily win enough votes to send the package to the House this week.

It remains to be seen whether Reid and Senate Republican Leader Mitch McConnell (Ky.) allow any amendments to be offered to the package.

Sens. Olympia Snowe (R-Maine) and Brown have filed legislation to direct the Department of Commerce to impose countervailing duties on exports from China and other countries that are found to be manipulating currency values. Snowe and Brown would like to offer the proposal as an amendment to the broader tax package.

Senate passage would set up a showdown with House Democrats, who have voiced strong reservations about the tax bill. House liberals are most incensed by the proposal to set the estate tax at 35 percent for individual inheritances above $5 million.

The estate tax was set at 45 percent for inheritances over 3.5 million in 2009 and was phased out in 2010 because of the 2001 tax relief package. The Bush-era tax cuts are due to expire on Dec. 31, which would set the estate tax back at 55 percent with a $1 million exemption.

House Majority Leader Steny Hoyer (D-Md.) on Monday said House Democrats might amend the estate tax or other provisions they dislike in the package.

Hoyer, however, predicted the House would ultimately pass the package.

“There certainly seems to me to be some room for a change, which may or may not be perceived by some to be significant,” Hoyer told reporters at the National Press Club.

If the House set the estate tax at its 2009 level and returned the package to the Senate, it’s unclear whether Republicans would still support it. They may in turn demand reductions in unemployment benefits or call for their cost to be offset by spending cuts.

The package would also extend unemployment benefits for 13 months and cut the payroll tax from 6.2 percent to 4.2, earning a worker who makes $40,000 an $800 tax break.

The deal extends a variety of business and energy tax provisions for two years, including the research and development tax credit, the ethanol tax credit and a grant program for the solar and wind energy industries.

It also allows businesses to write off 100 percent of the cost of certain investments.

White House officials have circulated projections that the package could help add 1.5 million to 2 million jobs to the economy.