Posted on September 8, 2010
By Dave Flessner
Senate Republicans are open to supporting White House proposals to expand business tax credits for research and development but not before Congress decides to extend the Bush tax credits that will expire at the end of the year, U.S. Sen. Lamar Alexander said Tuesday.
Alexander, the chairman of the Senate Republican Caucus, told the Chattanooga Pachyderm Club that taxes shouldn’t be raised during a recession, even on wealthy Americans whose small businesses hire most workers.
“The first thing we need to do is to make sure that we don’t raise taxes” by allowing the Bush tax credits to expire at the end of the year, Alexander said. “That is going to take most of September. Then we can turn our attention to seeing if we have money to reduce taxes.”
In a speech planned today in Cleveland, Ohio, Obama will ask Congress to let businesses quickly write off 100 percent of their spending on new plants and equipment through 2011. The move is the latest by the White House to help spur an economy that is expected to take years to regain most of the jobs lost over the past three years.
Alexander said he has supported such R&D investment credits in the past. But Tennessee’s senior senator said the best way to revive the economy is to lower taxes and the deficit and provide a more stable environment for all businesses.
President Obama has “put a wet blanket” on job creation with the health care reforms, financial regulations and higher taxes planned in the next year, Alexander told the GOP luncheon club at the DoubleTree hotel downtown.
Alexander said the health care legislation “rammed through Congress in the cold of Christmas Eve” will raise the tax burden on many small businesses who hire most American workers. The extra taxes and compliance costs for health care and Wall Street reform measures adopted this year are making businesses more uncertain about their future, especially with the prospect of new energy regulations and easier unionization rules.
Alexander said the stimulus legislation written in 2009 by congressional Democrats is driving up federal deficits but not promoting enough job growth.
“It was a spending bill, not a stimulus bill,” Alexander said.
The tax cuts on capital gains and marginal income adopted when George Bush was president are scheduled to expire at the end of the year. Obama has proposed extending the tax credits, but only for those making under $250,000 a year.
Alexander said half of jobs created by small businesses come from companies whose income tax would be raised in January under the White House’s plans.
Tennessee Democratic Party Chairman Chip Forrester said the U.S. economy has added private sector jobs for the past eight months after falling for the previous 22 months.
“Unfortunately, there is not a single Republican that has supported any measure to bring the country out of the worst economic crisis that we have experienced since the Great Depression when the Republicans drove the economy into a ditch,” he said.Subscribe Here!