90 percent levy targets AIG execs
WASHINGTON – The House approved a bill Thursday that would impose a new tax on the $165 million in bonuses paid by bailed-out insurance giant AIG, as Senate Republicans stepped up criticism of the Obama administration’s handling of such bonuses.
The House measure would apply a 90 percent tax on bonuses given to employees who earn more than $250,000 at any firm that received more than $5 billion in bailout money.
The vote was 328-93.
“We want our money back and we want our money back now for the taxpayers,” said House Speaker Nancy Pelosi, D-Calif.
In all, 243 Democrats and 85 Republicans voted “yes” on the bill. It was opposed by six Democrats and 87 Republicans.
The margin of victory came despite sharp Republican criticism of the Obama administration.
Minority Leader John Boehner, R-Ohio, said the bill was “a political circus” diverting attention from why the administration hadn’t done more to block the bonuses before they were paid.
A proposal in the Senate would impose a 35 percent excise tax on companies paying bonuses and a 35 percent tax on employees receiving them. It would apply to all companies that received federal bailout funds.
Senate Majority Leader Harry Reid, D-Nev., said he doesn’t think it would be much of a problem to resolve the differences between the House and Senate. They are hoping to move on the Senate bill next week.
Topic No. 1 raised by Republicans during the House debate was the last-minute altering of a provision in the recently passed stimulus bill to cap executive compensation for firms receiving government bailouts. The measure might have forestalled payment of the AIG bonuses.
But Senate Banking Committee Chairman Chris Dodd, D-Conn., the author of the provision, said the administration insisted that he modify his proposal so that it would only apply to payments agreed to in the future.
“The idea came from the administration,” Dodd said Thursday.
Dodd said he was not aware of any AIG bonuses at the time the change was made.
Treasury Secretary Timothy Geithner confirmed such conversations with Dodd. He said the administration was worried about possible legal challenges to the provision.
The Associated Press contributed to this article.