by Frank James
What do rum, motorsport race tracks and wooden arrows used by kids all have in common? The financial markets bailout bill, that's what.
Taxpayers for Common Sense has compiled a handy list of what it called the top ten tax-related provisions in the financial-markets bailout bill passed yesterday by the Senate and they include some provisions that touch on, yes, rum, motorsport and wooden arrows and more.
As TCS says:
Not all the provisions are per se outrageous, but collectively are intended to help Congressional leadership get final passage of the 2008 Emergency Economic Stabilization Act.
There's some thinking that while they may help to win some votes in the House, where the bailout bill was voted down Monday, they may also help to lose some votes, especially among the conservative House Democrats known as the Blue Dogs.
Here's the list:
1. Sec. 503. Exemption from excise tax for certain wooden arrows designed for use by children. (Page 263)
Current law places an excise tax of 39 cents on the first sale by the manufacturer, producer, or importer of any shaft of a type used to produce certain types of arrows. This proposal would exempt from the excise tax any shaft consisting of all natural wood with no laminations or artificial means to enhance the spine of the shaft used in the manufacture of an arrow that measures 5/16 of an inch or less and is unsuited for use with a bow with a peak draw weight of 30 pounds or more. The proposal is effective for shafts first sold after the date of enactment. The estimated cost of the proposal is $2 million over ten years, according to the Joint Committee on Taxation.
The Oregon senators were the initial sponsors of the provisions. According to Bloomberg News, the provision would be worth $200,000 to Rose City Archery in Myrtle Point, Oregon
2. Sec. 317. Seven-year cost recovery period for motorsports racing track facility. .(Page 262)
Track owners want to be able write off the cost of their facilities on their taxes over seven years - a depreciation timetable many of them have used for decades. But the IRS has wanted to stretch it to at least 15 years and has raised questions whether the increasingly popular tracks really belong in the same tax category as amusement parks.
Auto track owners are simply trying to get out of paying more taxes - which they'd have to do if they deducted less every year. These owners have gotten plenty of tax breaks over the years from states and localities eager to get speedways. The provision would be extend 2 years till the end of 2009 and would cost 100 million. The provision encompasses all facilities including grandstands, parking lots and concession stands.
3. Sec. 308. Increase in limit on cover over of rum excise tax to Puerto Rico and the Virgin Islands. (Page 262)
Extends until December 31, 2009 a rebate against excise taxes charged on rum imported from Puerto Rico and the Virgin Islands. A $13.50 per proof gallon excise tax is applied to distilled spirits imported to the U.S. Under this provision a $13.25 rebate is returned to PR and the VI, and is retroactive back to January 1, 2008. Permanent law sets the rebate at $10.50 per proof gallon, but the PR and VI provisions have generally been in place since the first Clinton administration. The most recent extension of the $13.50 rebate expired January 1, 2008. Cost is $192 million.
4. Sec. 301. Extension and modification of research credit.(Page 262)
The legislation reestablishes and extends the lucrative tax credit for companies doing research and experimentation in the United States. Companies that have benefited from this provision include Microsoft Corp., Boeing Co., United Technologies Corp., Electronic Data Systems Corp. and Harley-Davidson. The two-year extension is estimate to cost $19 billion.
5. Sec. 504. Income averaging for amounts received in connection with the Exxon Valdez litigation.(Page 263)
The bailout bill would give a tax break to Exxon Valdez plaintiffs, allowing them to average out their punitive damages awards over three years rather than suffer a one-time tax hit from the Internal Revenue Service as well as other provisions. Rep. Don Young is a big supporter of this provision. Cost is estimated at $49 million dollars.
6. Sec. 601. Secure rural schools and community self-determination program.
Secure Rural Schools (Lead sponsors Reps. DeFazio (D-OR), Bill Sali (R-ID); Sens. Wyden (D-OR), Larry Craig (R-ID) are major boosters of this program that expired in 2006. In 1908 the federal government agreed to share logging revenue from Forest Service land with neighboring communities that could not tax the land because it was federal. As logging declined in the 1990s, the "county payments" program was initiated that directly provided federal funding, more than half going to Oregon, to deal with the loss of revenue in 2000. The original version of this bill was introduced in early 2007 and was estimated to cost $2.2 billion when the OR and ID delegations came to agreement. To give the package more heft, Payment In Lieu of Taxes (PILT) was added to the package, bringing the total cost to $3.3 billion. PILT provides more general funding to counties for federal lands located within their borders. Sen. Reid talked about the PILT program being one of the important elements of the package when the Senate passed the bailout bill.
7. Sec. 201. Deduction for state and local sales taxes (Page 261)
Allows residents of states that don't pay income tax to deduct sales tax paid over the course of the year from their federal tax. States that benefit include Texas, Nevada, Florida, Washington and Wyoming. The bailout bill extends this provision for 2 years at a cost of $3.3 billion.
8. Sec 502. Provisions related to film and television productions (Page 263)
In an effort to keep film and television productions in the U.S, they would be eligible for a tax incentive program. Under this program, the cost of production of qualifying films would be permitted to be immediately expensed -- that is, fully deducted from income for tax purposes -- in the year the expenditures occur. And makes other favorable tax treatments for production permanent. Historically Rep. Diane Watson (D-CA) has been a supporter (dating from its creation in the 2004 corporate tax bill). The cost is estimated at $478 million over 10 years.
9. Sec. 325. Extension and modification of duty suspension on wool products; wool research fund; wool duty refunds.
The tariff relief (duty savings) is intended to benefit U.S. worsted wool fabric producers that use imported fibers and yarns as inputs, as well as U.S. tailored clothing manufacturers that use imported fabrics as inputs. This provision was originally introduced as a bill in December 2007 by Reps. Louise Slaughter (D-NY) and Melissa Bean (D-IL). It extends current law provisions until 12/31/14, and in some cases to12/31/15. The 2010 to 2015 cost is estimated to be $148 million.
10. Sec. 309. Extension of economic development credit for American Samoa. .(Page 262)
This extends by two years a previously approved tax credit, the American Samoa economic development credit. In general, this credit allows certain corporations operating in American Samoa with a tax credit. The possessions tax credit allows these corporations to offset a portion of their U.S. tax liability on income earned in American Samoa from active business operations, sales of assets used in a business, or certain investments in American Samoa. The cost is $33 million, according to the Joint Committee on Taxation.
Other Examples:
Here are some other interesting provisions
Sec. 201. Inclusion of cellulosic biofuel in bonus depreciation for biomass ethanol plant property.(Page 114)
Current law allows taxpayers to write off 50% of the cost of any facility placed in service before January 1, 2013 that produces cellulosic ethanol. This provision expands the types of facilities that may be written off to include production of other cellulosic biofuels in addition to cellulosic ethanol.
Sec. 211. Transportation fringe benefit to bicycle commuters. (Page 114)
Allows employers to provide a benefit to employees for costs associated with bicycle commuting, including purchase and repair of a bicycle, bicycle improvements, and bicycle storage. This provision was proposed in 2007 in the Senate by Sen. Ron Wyden (D-OR) and in the House by Rep. Earl Blumenauer (D-OR). This provision is estimated to cost $10 million.
Sec. 323. Enhanced charitable deductions for contributions of food inventory. .(Page 262)
Extends by two years, until December 31, 2009, a provision allowing for deductions related to the charitable donation of "apparently wholesome food"--defined as food intended for human consumption that meets all quality and labeling standards imposed by law and regulations even though the food may not be readily marketable. This provision also changes the application of the law as it relates to donations by farmers and ranchers. The cost is $149 million, according to Joint Committee on Taxation.
Sec. 324. Extension of enhanced charitable deduction for contributions of book inventory. (Page 262)
Extends by two years, until December 31, 2009, a tax benefit for the contribution of books to public schools. The provision is worth $49 million.
Sec. 602. Transfer to abandoned mine reclamation fund.
Transfers interest earned on money in the abandoned mine reclamation fund to the United Mine Workers of America Combined Benefit Fund, which helps pay health benefits for retired miners and their dependents who worked under collective bargaining agreements that promised lifetime health-care benefits. States with the most miners receiving benefits have historically been Pennsylvania, West Virginia, Kentucky, Virginia and Ohio. This provision extends existing law to include a $9 million transfer for 2010.
• 
• 
• 
Comments
Initial "Bill":3 pages.
Current "Bill":263 pages.
Time to read it (and during an election year): 1 day.
How is it that Congress can take a terrible idea, and make it 260 pages WORSE?
Just the fact that there are Conservative Democrats voting NO to this shows that the Republican Party has lost it's way.
Liberals == The new Conservatives.
What a Brave New World we are in....
Posted by: No More Bailouts | October 2, 2008 3:39 PM
The Wall Street bailout bill that the wealthy US senators passed last evening has 150 billion dollars more in pork and earmarks than the original Paulson rip-off bill. The Senate saw fit to steal 850 billion dollars from American taxpayers when there was no real crisis--when Bush and Paulson sat on the original 700 billion bailout bill for almost two months. What was/is the big hurry?
McCain's main campaign plank is no pork and no earmarks. McCain just voted for the biggest pork and earmark package of his career. Shame on McCain.
Obama sold middle class Americans out with his yes vote--middle class Americans pay most of the taxes. Obama was happy to vote yes for the biggest Wall Street bailout in American history. Now Obama, if elected, can sit back, renig on campaign promises and work at a lower standard for We The People. He just has to remind Americans how we "needed" to pass a bailout bill due to the crooked republicans. Shame on Obama.
It seems that the American Senate is one big Organized Crime family. The only difference is that the Organized Crime families that I have read about in the past take care of widows and children. They also respect the family much more than the US Senate. Shame on the Crime family of the US Senate.
If the present bill passes in the House, America is destined to be a Socialist nation. Think about why. There will be no going back--ever. All of the middle class will have a lower standard of living for the rest of time. Our hands will be tied with huge financial commitments based on what one man instigated--one man who will be out of office in three months. We will never be free to decide where to spend our hard earned money. This one decider man man has no vested interest in our wellbeing due to his own private wealth. Shame on him.
Being a Democrat or being a Republican does not matter any more. It is only something to divide We The People. And, when the politicians divide us up, they have conquered us as a whole people. Something is very wrong and something smells very bad. This bailout bill was not even allowed to go into committee. The bailout bill forces American taxpayers to bail out foreign banks. Bush gave away our jobs, now we are forced to give foreigners our tax money, also. Once again, Bush rushed something--terribly wrong--through before a recess, and, with great fear mongering. I hope to God the House holds strong and votes NO on the Senate's bill. I hope to God that the House, the House of common people of America, will stand firm and won't allow our free market Democracy to turn into Socialism. Hell will not be far away, and we will hate living in a nation that has nothing to do with who we are.
Posted by: Vivian | October 2, 2008 6:59 PM
this is absolutely horrible. Where to these "elected officials" get off spending our hard earned money on stupid special interest group wants and desires. The arrow one really gives us the "shaft".
I say vote them all out next election. To me it looks like a dictatorship and a socialistic/comunistic style government is in the offing.
Posted by: Enough is Enough | October 2, 2008 7:25 PM
Frank James article, although informative, did not name the Senators that sponsored the "pork belly" additions to the rescue package...and most likely did not vote for the first version when it was voted upon..How's about putting the country and it's citizens first FOR A CHANGE!
Posted by: David Dullman | October 2, 2008 7:44 PM
Why is this so-called important legislation littered with add-ons? These additions make our Senators look selfish and short sighted. Slowly but surely America's stature in the the world is being diminished.
Posted by: ejhickey | October 2, 2008 11:50 PM
The Fact that the legislation, (2000’s Commodity Futures Modernization Act, was introduced and sponsored by President Bush’ fellow Texan, and Senator McCain’s economic advisor ex-Senator Phil Gramm, and overwhelmingly approved by Republicans), allowed our financial institutions to trade our mortgages and debt like they were baseball cards, still makes it difficult to argue against a “bailout”. God knows these companies don’t deserve it. So the taxpayers, already millions of whom have lost their homes, and jobs, must pony up $700 Billion. To help offset some of that, how about getting back the $385 Million dollars already paid to VP Cheney’s “previous” employer Halliburton, in 2006. This money was given to them just in case massive detention centers needed to be built in America! Hard to believe, ain’t it? $385 Million of our tax dollars given away for future services! No wonder our country owes the Chinese $500 Billion dollars, with money management decisions like this. Imagine what an extra $350 million dollars could do for our, or any other state, instead of being given to the VP’s buddies. It shouldn’t be hard for voters to see which party represents Big Business, and which represents the people.
Posted by: matt okeefe | October 3, 2008 12:28 AM
HEY MATT>trading the debt like baseball cards IS NOT THE SIN..... IT'S USING WHAT'S CALLED NINJA (no income, no job, or assets) LOANS that are being SAID TO BE SECURE BY FANNIE THEN FREDDIE and bundling them up along with some good loans and then used as COLLATERAL in a bunch of business deals.
Once the rates went up on the bad loans to the poor (illegals, blacks etc) they defaulted. Some out there got 2nd mortgages to invest in propert and folded for that reason.
People also got special deals on loans (DODD BEING ONE OF THEM) for morgages on investment property that they dumped when they saw that the market burst and their investment was worth far less from the properties lesser value.
Posted by: I WROTE > I HOPE THEY HAVE A BI-PASS | October 3, 2008 6:26 AM
SEND SARAH -
The politicians in Washington cannot help themselves - they are a product of the system.
Unfortunately 3out of 4 of the Pres-VP nominees are long term politicians schooled in the ways of Washington.
We need an outsider, a plain talking, real American; and that is Sarah Palin.
You can have the polish of the others and all the speeches Obama could make, but give me a common sense real person anytime.
SEND SARAH to DC
Posted by: Jimmy G | October 3, 2008 11:42 AM
I'd like to address all you hypocrites out there that are looking for a little something in this bill for them. They are the same people that are going to vote for the person in November that will promise them the most. You should all read Atlas Shrugged by Ayn Rand. This book is about exactly what has been going on in this country for as long as I've been alive. Everyone looks to Uncle Sam to give them a little something from the Treasury. All you fools out there that are trying to raise a family by working at a fast food joint or selling stuff at Sears are in this category. Guess what, those type jobs aren't and never were meant to raise families on. They are for kids in high school so they can make a few bucks before they move on with there lives. They shouldn't be paying you for health care and they don't owe you anything except minumum wage, if that. So if you are looking for anyone to blame for this idiocy going on right now, look to yourself, because if you think this is going to get better with the number of gimme programs in this country you are seriously deluding yourself.
Posted by: Mark Schlaefer | October 3, 2008 12:40 PM
(The Wall Street bailout bill that the wealthy US senators passed last evening has 150 billion dollars more in pork and earmarks than the original Paulson rip-off bill)
Yes -- but in fairness, it's always pork until it gets to your district. Then it's jobs and infrastructure.
Posted by: bluesky | October 3, 2008 1:00 PM
(Where to these "elected officials" get off spending our hard earned money on stupid special interest group wants and desires.)
Three words - campaign finance reform.
We all have to push for it if silly and self-serving provisions like this are going to end.
Posted by: bluesky | October 3, 2008 1:01 PM
Please someone, . . . anyone come to the rescue of America! We've known for years that Wall Street only cares about themselves and their wealth which is at the expense of "Main Street" America. Obviously this congress only cares about themselves and their wealth again at the expense of "Main Street" America. Apparently Biden, McCain and Obama have all forgotten the platforms that they are running on . . . CHANGE - HA! Some change, more of the same, from all of them. What a bunch of liars.
Posted by: Furious | October 3, 2008 2:22 PM
Thanks to Frank James and others for posting articles on this topic. So during one of the greatest financial crises, with Wall Street and the American economy running off the rails, our government representatives acted in record time to create an emergency rescue plan. Yet they still managed to pause along the way and help themselves to $150 billion for arrows, rum, race tracks, and wool? Where’s the line item veto? God help us, that even (or especially) in the midst of a disaster, that these piggies can’t keep themselves from the trough. You’d think it’d be tough to save a burning house and loot it at the same time, but somehow they’re brazenly pulling it off.
Can someone reference or post a list of names for all these pork barrel sponsors, so that they can be strung up and shot, or at least voted out of office at the next opportunity?
Posted by: Ron | October 3, 2008 3:07 PM
I hope this helps stabilize the markets. I don't mind helping others but being down 55% myself I can use some help to. I pay taxes on gains then lose thosegains plus.
I just became an American citizen from Canada. I hope Mcain and Palin win. I don't Want to see the US become another Canada. Good luck fellow Americans.
Posted by: Tina | October 4, 2008 12:14 PM
How dare you spend these millions of dollars on this kind of PORK....YOU IN THE CONGRESS SHOULD BE SENT HOME IN DISGRACE FOR THIS KIND OF COSTLY EARMARKS TO THE BAILOUT BILL. ...THIS WILL TAKE THE COUNTRY DOWN BEFORE ANYTHING ELSE.
Posted by: Nita Hirst | October 4, 2008 12:58 PM
Go figure! On Monday, our representatives voted down the $700 billion Wall Street bailout. On Friday, they approved the same bill, with Senate-added earmarks and pork, by a wide margin! What gives? $700 billion, when adding in the earmarks and foreclosure bailout becomes $1.1 trillion! And still the Dow fell.
Was Monday smoke and mirrors? Michigan's delegation went from 9-6 opposed to 9-6 in favor. As I understand it, the big difference is the added Senate pork! How does this justify a change in voting?
Do you have the guts to vote for the challenger if your Representative and Senators did not vote your wishes?
Posted by: Cynical Synapse | October 4, 2008 6:23 PM
I thought my best choice would be O'Bama. I've changed my mind: He is the least worst of the two candidates. It astounds me that they both approved the bail out bill with all of the pork included. We're deeper in debt. Vote the incumbents out!Enough is enough America!
Posted by: Mervin Andy Fiel | October 6, 2008 4:36 PM
What should have been the cleanest bill in the history of the united states is an absolute disgrace. This is why we left England. Both the Dems and Republicans want us to choose sides over every issue and point the finger, that way the real issue gets lost in the smoke- that nobody is looking out for th 90% of us that work hard every day and contribute. Unbelievable.
Posted by: Chris s | October 6, 2008 9:39 PM
they (including AIG more recently) are making fools of us all; we are helpless.
Posted by: evelyne laflamme | October 8, 2008 2:47 PM
Could somebody just tell me who we're the ones that put riders on this bill. Then we vote them out of office it's that simple. Why doesn't the American voter get it? You can put any color of lipstick on it, but it is what it is pork. So get rid of the very people who put the riders in, albeit Dem or Rep. Think, Act, & Vote, the very basic principals of our system.....If anyone out there knows, post it and we'll work from there...
Posted by: Tim | October 13, 2008 6:52 PM
> middle class Americans pay most
> of the taxes
Actually, not really, unless you meant "upper middle class" (and I'm not sure you meant that at all). From http://en.wikipedia.org/wiki/Taxation_in_the_United_States#Progressive_nature we have:
In 2001 the top 1% earned 14.8%
of all income and paid 34.4% of
federal income taxes. The next 4%
earned 12.7% and paid 20.8%.
In other words, the top 5% paid 55.2% of taxes. The top 5% by household income, from http://en.wikipedia.org/wiki/Household_income_in_the_United_States would all be above $150,000 a year, which I would tend to think of as upper middle class, not middle class.
That 1% that paid 34% of the taxes are all at over $250,000 a year.
Posted by: Boris | October 14, 2008 10:22 AM
"When the people fear their government, there is tyranny; when the government fears the people, there is liberty." -- Thomas Jefferson
Posted by: concerned | October 20, 2008 6:49 PM