House passes tax cut bill; Dems decry breaks for wealthy

Chip Somodevilla/Getty Images

(CBS News) The Republican-led House on Thursday passed a bill aimed at spurring the economy by putting more cash in the pockets of small business owners.

Democrats, meanwhile, spurned the legislation as an ineffective measure that will put money in the hands of the wealthy -- not to mention controversial business owners like pornographers -- at the taxpayers' expense.

By a vote of 255 to 173, which fell largely along party lines, the House passed the Small Business Tax Cut Act. The measure would give small businesses with fewer than 500 employees a one-time 20 percent tax deduction.

When he unveiled the bill, House Majority Leader Eric Cantor said as many as 22 million small business owners could get the tax break "so that they can reinvest those funds." Today, he said it was "something we felt was the very least we could do to help the job generators."

The bill is sure to fail in the Senate, where Democrats have a similar but competing measure: The Senate bill would give small businesses tax breaks specifically for hiring new employees or for capital expenditures.

Senate Majority Leader Harry Reid called the House bill, which would cost $46 billion, "just another example of giveaways to big corporations and the wealthy under the guise of small business."

The Small Business Tax Cut Act was one of the tax policy proposals put for a symbolic vote this week in order to give voters an idea of the differences between Republican and Democratic economic philosophies -- the other was the Democrats' Buffett Rule, which failed in the Senate.

Before Republicans passed the Small Business Tax Cut Act today, Democrats unsuccessfully put forward amendments designed to illustrate their objections to the bill. A vote on a Democratic substitute for the bill, which would have extended a tax break only for companies that make capital improvements, failed.

After that, an amendment that would have excluded certain small businesses from the tax break, including companies that violate the Iran Sanctions Act, companies outsourcing jobs, and pornographers, among others, also failed.

Democratic Rep. Ted Deutch of Florida, who put forward the amendment, call it a "relatively small" change to the bill.

"Certainly our constituents don't want us borrowing money from China to give to companies that outsource jobs to China," he said on the House floor. Companies "that are American in name only... do not deserve another giveaway."

He pleaded with his colleagues to "prevent Americans' hard-earned tax dollars from subsidizing Iranian nukes, cutting costs for criminals, padding the pockets of pornographers, and let's make sure that this bill does not reward companies that ship jobs overseas."

Republican Rep. Dave Camp of Michigan called Deutch's amendment a "political ploy."

"We should not be picking winners and losers," he said. "The fact is, small businesses are hurting because of the failed policies of the Obama administration."

[stormerF69]

Funny how when you target tax breaks for small businesses,the Democrats still cry and whine that it is for the wealthy. If the Bush tax did not work would the Democrats extend them again and again?

[TJphoto]

Look at what we've done for you!!!Vote for Us this election!!! Hello GOP, have you ever seen sheep run off a cliff???

[stormerF69]

Why are the Democrtas against tax breaks for small businesses? That was their main whinning point ,trying to shove their healthcare bill, the non-existence tax breaks for small businesses who hired people and gave them health care.

[forrestt56]

If you do not like what happened here DON"T VOTE REPUBLICAN!
They are undoing the nation from within as fast as they can.

[stormerF69]

Like the Democrats who are playing budget games for over 3 years? If the Bush tax cuts were not working why did the democrtas extend them,again,and again,and again?

[WhatIsFair_2012]

So what is going to pay for this 46 billion dollar bill?

[stormerF69]

We will access Obama's money tree,the one in the east garden you know the one he keeps spending from, where else? maybe we can use some of the 500 billion the Dimocrats took from medicare to get Obamacare started?

[euge005]

It was a case in point to ggive tax payers money to those who can be counted on to provide more kick backs to the same GOP puppets. Shameful as they are dishonest. Pitiful.

[stormerF69]

Like giving the CEO of GE a position in government,while they made 500 billion in the US and never paid one dime in taxes? Or using Air Force one as a shuttle from DC to Ohio,like 18 times in 3 years,At 187,000.00 an hour.

[marychgo]

I keep trying to convince myself that at least SOME Republicans actually think these "tax cuts for small businesses" will create jobs. But I keep failing...because if I know that most "small businesses" are actually single-employee professional or service corporations for lawyers and physicians and accountants at huge, powerful firms, how can the GOPers who are getting campaign contributions from those "small businesses" not know the same thing?

[stormerF69]

Yea the Democrats are so against tax cuts,they extended the bush tax cuts twice.HAHAHAHAHAHAHAHAHAHA

[hhandyman]

Another reason to outsource Republican incumbents to independent citizens that want to see this nation grow and not another purse increase for the wealthy 1%of 1% source of Special interest groups. Check the Congressional Record Voting list and any Yea vote is the evidence of a persons need to be replaced with an HONEST non-self serving citizen.

[nearl451]

The REpublicans have never been for balancing the budget. They have been for un-paid for tax breaks abjectly, however.

[TimeToEvolve]

I agree wholeheartedly, the oligarchs and the corporations caused the deficits and the national debt and they should pay it back. If they refuse we seize their assets. What do they expect, US to pay it back after they stole it?

[nonpolitico]

Of course, the US businessman could always give all his/her riches to the mob!
Then the State could confiscate it, and the junta then in charge could totally nationalise the USA creating a closed society,with an appointed set of poor people, with NO CONCEPT of running ANYTHING,even a bath,to run the country, military, hospitals, farms, industry et al.
It`s been done before you say?
Who did it? The Soviets??
Wow, so that is why the Obama led Democrats are keen on all the Programs and school indoctrination, and all the Washington Crats!!
Is that REALLY what CITIZENS of this Great Country may be looking at with a second term for Obama??

[retm-w]

No differen't then what the gop wants, corporations running the country. Exact same thing and we're almost there.

[euge005]

What you seem to be unwilling to see is that those programs are intended to let the people working 2 jobs and trying to get an education actually get ahead. That way they can get a part of the brass ring. We are all of us, the 99% being screwed by the GOP and we are darn tired of it. Omaba is not doing enough true. But he is too moderate, too measured and lacking character in fighting these bought and paid for pols from the extreme right. Simply arrest Canotor and the others for birbery, we all know they are crooked to the core.