Brown pushes for steep tax on bonuses

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Brown pushes for steep tax on bonuses

Politico – Joining a host of other Democrats eager to channel populist outrage at Wall Street, Sen. Sherrod Brown (D-Ohio) unveiled legislation Thursday that would slap a 50 percent tax on bonuses paid by all banks that received bailout money.

Brown's bill would divert the tax proceeds, which he estimates at from $8 billion to $10 billion, to support loans for small businesses.

“Wall Street’s lavish bonuses were made possible by taxpayers,” Brown said during a 30-minute afternoon conference call with reporters. “That money was supposed to be lended to small businesses. It hasn’t been.”

Under Brown’s plan, recipients of bonuses would need to pay a 50 percent excise tax on any bonus money over $25,000 if their firm received any money from the government's Troubled Asset Relief Fund. Firms such as Goldman Sachs, which have paid back what they received, would still see their employees hit with Brown’s proposed tax.

Several plans to pass hefty taxes on big bonuses have gone nowhere during the past year-and-a-half, and there’s no reason to think this time will be different. Democrats, though, are eager to burnish their populist credentials as polls show mounting voter frustrations with the party’s performance in Congress.

Brown, who insists he thinks his bill will “see overwhelming support,” also said he wants to force the Republicans to take an uncomfortable vote. It might help with the Democratic strategy to try convincing blue-collar voters that the GOP cares more about the rich and big business than about them.

“Most of these banks are healthy again, but the rest of the economy’s not,” Brown said. “These banks are healthy because the taxpayers stepped up and assisted them. … This country has made Wall Street rich. Wall Street has not, in the last decade, returned the favor, frankly, and this bill will help them do that.”

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