Senate to Vote on Competing Democratic, GOP Tax Plans


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WASHINGTON (CNN) — In a pivotal moment in the battle for leverage on a defining issue, the Senate will hold a pair of high-profile votes Wednesday on competing Democratic and Republican plans to extend the Bush-era tax cuts .

While neither proposal is expected to pass both chambers of Congress, each represents its party’s position on the issue heading into the fall campaign. The votes are also the opening bids for what is sure to be a frenzied negotiating session as the economy nears the so-called “fiscal cliff.”

The Senate Democrats’ bill would extend the tax cuts — which are now set to expire at the end of the year — just on incomes under $250,000 for a couple and $200,000 for an individual. That’s in keeping with their pledge to preserve the Bush tax cuts for the middle class, not the wealthy.

The GOP bill would extend the tax cuts for all taxpayers — including the wealthiest Americans — and includes a requirement that Congress tackle comprehensive tax reform within a year. Republicans argue that any tax hikes could derail what is already considered a weak recovery.

After Senate leaders jockeyed for days over procedural issues, Senate Minority Leader Mitch McConnell, R-Kentucky, unexpectedly announced Wednesday morning that Republicans would agree to Democratic demands and hold two back-to-back votes.

Democrats, who control 53 of the chamber’s 100 seats, are confident their bill can get at least 51 votes. That will give them the ability to boast that their bill won a majority in the Senate, even though they know it has no chance of winning approval in the GOP-controlled House.

The minority Republicans, down one member because of Illinois Sen. Mark Kirk’s illness, are unlikely to get the necessary majority for their bill.

McConnell, who accepted a possible public relations hit in agreeing to the two votes, said Wednesday morning that the issue is so important that voters need to know where their elected officials stand on it.

“We owe it to the American people to let them know whether we actually think it is a good idea to double down on the failed economic policies of the past few years or whether we support a new approach,” McConnell said on the Senate floor. “Whether we think it is a good idea to raise taxes on nearly a million business owners at a moment when millions of Americans are struggling to find work or do no harm and commit to future reform.”

McConnell, perceiving another plus for the GOP, also announced that Republicans had dropped their demand for a filibuster-proof 60 vote margin and would instead agree to a simple majority threshold. Many centrist Democrats who in the past have argued against raising taxes on wealthier Americans, McConnell noted, will now be forced to cast a vote on their party’s bill.

“By setting these votes at a 50-vote threshold, nobody on the other side can hide behind a procedural vote while leaving their views on the actual bill itself a mystery,” McConnell said.

While two members of the Democratic caucus — Jim Webb of Virginia and Independent Joe Lieberman of Connecticut, — have said they will vote against the Democratic bill, Senate Majority Leader Harry Reid, D-Nevada, has said his caucus otherwise stands solidly behind the bill. Democrats also point to polling that shows a majority of Americans support their approach.

“Our bill has the support of President Obama, has the support of the Democratic caucus and has the support of the American people A majority of Americans, including a significant majority of Republicans, agree taxes should remain low for the middle class and the top two percent should pay their fair share to reduce the deficit,” Reid said. “The only place there is no agreement is with Republicans in Congress.”

On Tuesday, Democrats railed against Republicans for wanting to extend tax cuts for the wealthy while at the same time not including three expiring tax credits for many middle and lower income families that both the president and Senate Democrats included in their bills.

The tax credits, which were approved as part of the 2009 economic stimulus law that most Republicans opposed, include credits for college tuition costs and expanded versions of both the child tax credit and the earned income tax credit.

“This idea that they don’t want to raise taxes on anyone,” complained Sen. Chuck Schumer, D-New York. “They’re okay raising taxes on many middle class people as long as they get their tax breaks for the very wealthiest among us. That’s an amazing and astounding point.”

Asked about decision to leave out the tax credits, McConnell said he couldn’t answer because he had just found out about the omission and Arizona Sen. Jon Kyl, the number two Republican, said he would have to find out why.

By Ted Barrett

CNN Senior Congressional Producer
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