From NBC's Mike Viqueira
House Republicans will by and large vote against the bonus tax today.
A spokesman for John Boehner says the leader will vote against it. Also, the leader of the conservative caucus has just put out a memo to his members asking for a "nay" vote (full release below).
But House Democratic leaders have brought it up under special rules that require a two-thirds majority for passage. So now the question becomes, will it pass?
The debate and vote is scheduled for perhaps later this afternoon.
Question: Can you even stand the suspense?
GOP Conservative "action alert":
RSC Chairman Price urges all RSC Members to vote no on today's retroactive tax punishment bill (H.R. 1586, introduced by Rep. Charles Rangel, D-NY).
NOTE: The National Taxpayers Union (NTU) will score AGAINST this bill in its annual ratings of Congress. More information on other groups is forthcoming.
The legislation imposes a 90% tax for bonuses received by an employee of a company that has received funds in excess of $5 billion from the Troubled Asset Relief Program (TARP)-or an employee of Fannie Mae or Freddie Mac. The bill establishes a gross income exemption (including the bonus) of $250,000--or $125,000 in the case of a married individual filing separately.
Possible Conservative Concerns:
Two Wrongs Don't Make a Right. Most conservatives remain opposed to the massive taxpayer "bailouts" of private organizations. Without the bailouts, the taxpayers would never have been put in the position of their dollars being doled out for executive bonuses. But since the bonuses have been distributed, the solution is not to compound the problem with more inappropriate actions by the federal government. Two wrongs don't make a right.
Retroactive Tax Increase. The tax increase in the bill would be applied to bonuses paid after December 31, 2008. Many conservatives believe that retroactive tax increases are unfair and unconstitutional.
Confiscatory Tax Rate. The legislation creates a tax rate of 90%. According to the Tax Policy Center, the income tax has not had a tax rate at that level since 1963. Even before the 1981 tax cut under President Reagan, the top tax rate was 70%. Some conservatives may be concerned that this legislation establishes the precedent that the tax code can be used to impose confiscatory tax rates on other individuals.
Bill of Attainder. The bill, while not mentioning AIG by name, is clearly meant to punish AIG executives who received high bonuses--a specific group of individuals in response to public outrage over the bonuses. As Roll Call put it:
"House and Senate leaders moved at breakneck speed Wednesday to turn outrage over bonuses at American International Group and other bailed-out companies into retribution, with votes beginning today to impose punishing new tax provisions on the firms."
The author of the bill, Rep. Rangel, explains his motivation for the bill by saying that he "had an obligation to respond to the fears and anger of the people."
Given this motivation, many conservatives may believe that this legislation is a "Bill of Attainder"-a legislative action aimed at punishing individuals, explicitly prohibited by the Constitution in Article I, Section 9, Clause 3.