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May 10, 2006

Pryce Votes to Prevent Tax Increase

Provides relief to small business, seniors, and married couples

Washington – Today, Congresswoman Deborah Pryce (R-Upper Arlington) voted in favor of legislation preventing tax increases on small business owners, seniors, and families.  H.R. 4297, the Tax Increase Prevention and Reconciliation Act of 2005, extends alternative minimum tax relief, the increased limit on small business expensing, and the low rates on capital gains and dividends.  Pryce issued the following statement after House passage of the bill:

“This bill should come as welcomed news to thousands of small businesses, seniors, and families who were likely unaware that an enormous tax hike loomed in their futures. Today, Congress ensured that it will not apply the brakes to our growing economy, or stifle job growth through onerous and emasculating taxes.

“While everyone is entitled to their own opinion, they are not entitled to their own facts; and the facts about tax relief are as remarkable as they are indisputable. Since tax relief was signed into law, economic growth has averaged more than 3.9%; more than 5.2 million jobs have been created over 32 consecutive months; and real, after-tax incomes are up 12%. In just March and April, nearly 350,000 high-paying jobs were created.

“Equally important and contrary to the rhetoric, the tax cuts have led to record level receipts to the Treasury Department. This year, tax revenue was up $275 billion, a 14.6% increase over last year, as businesses grew, incomes rose, and high-paying jobs were created. Of that $275 billion in new federal revenue, $207 billion came from higher income-tax revenue, meaning the wealthiest of Americans – noteworthy, for a bill demonized by its opponents as being a handout to the rich. My priority will continue to be to ensure that Ohio reaps a greater share of this national growth.”

Among other things, the Tax Reconciliation Bill will do the following:

  • Extend capital gain/dividend for an additional two years.  Mutual fund holders who designate part of its dividends as capitol gain distribution stand to benefit from the provision included in the bill.
  • Prevent an increase on the Alternative Minimum Tax (AMT) for an additional year.  AMT is a tax some people have to pay in lieu of the regular income tax, especially two parent families with many kids who live in high-taxed States.
  • Extend the enhanced Section 179 of the Tax Code providing for continued Small Business expensing.
  • Dividends: Extends for two years the lower tax rate on dividend income, thus preventing a $13 billion tax increase over the next four years. 1 in 2 taxpaying senior citizens will benefit.
  • Capital Gains: Extends for two years the lower tax rate on capital gains income, thus preventing a $7 billion tax increase over the next four years.  Nearly 1 in 3 senior citizens will benefit.