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Tax Bill In Trouble; Bush Threatens Veto

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The Associated Press

Published: September 27, 2008

WASHINGTON - The year's most important tax package was in trouble Friday as the House passed a key part of it that the White House threatened to veto and the Senate said was a dead end.

On the table were four tax initiatives wrapped in one bill by the Senate this week: preventing more than 20 million people from being victimized by the alternative minimum tax, incentives for renewable energy, extension of expiring tax breaks and disaster relief.

All are must-do tasks for Congress before it adjourns for the year. The House, in three different bills on those issues, has taken the same approach as the Senate only on the alternative minimum tax. The Senate made clear that House divergence from its compromise will kill the package. The Senate bill passed 93-2.

Friday, the House voted 257-166 on a $60 billion measure on renewable energy initiatives and extension of business and individual tax breaks, credit for higher education tuition, deductions for state and local sales taxes and eligibility expansion on child tax credits.

It covers similar ground as the Senate bill: On energy, it provides investment and production tax credits for solar, wind and renewable resources, offers credits for buying plug-in electric cars and promotes conservation and energy efficiency. But the House insists relief be paid for by raising revenue elsewhere so the budget deficit doesn't worsen. The White House and Republicans oppose that, saying it is wrong to raise taxes to extend existing tax policy.

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