Economic Stimulus Bill Passes the House
WASHINGTON - Wisconsin's First District Congressman Paul Ryan today voted in favor of H.R. 1540, the Recovery Rebates and Economic Stimulus for the American People Act, also referred to as the "Economic Stimulus bill" to allow taxpayers to keep more of their own money. The House passed this bill by a vote of 385 to 35 with one member voting present.
The Economic Stimulus bill would provide rebate checks to individuals and families, bonus depreciation for businesses for new equipment purchases, increased expensing limits for small businesses and an increase in loan limits for Government Sponsored Enterprises (GSEs) such as Fannie Mae and Freddie Mac as well as the Federal Housing Administration (FHA).
"Since my first day in Congress, I have focused on protecting peoples' paychecks. People are overtaxed and the best aspect of this proposal is that it allows people keep more of their hard-earned money. I also believe the business incentives will help create jobs," Ryan said.
"I will not pretend, however, that this bill will do much to stimulate' the economy. This bill is more about good politics for both parties, than it is about sound economic policy. The idea that sending $100 billion back to people to spend at the mall will turn around a $14 trillion economy is fallacy and we shouldn't oversell this bill." Ryan said, "The bottom line is this: people are struggling to keep up with the cost of living and letting them keep more of what they earn is the right thing to do. That is why I voted for this bill."
Specifically, H.R. 1540 includes the following provisions:
Rebate Checks for Individuals and Families: Rebate check amounts would be determined by the greater of two options: (a) income tax paid in 2007, with a maximum of $600 for a single taxpayer and $1,200 for married couples; or (b) $300 for an individual and $600 for a married couple, provided the individual or couple earned income of at least $3,000 in 2007. The rebate check amounts would phase-out with adjusted gross incomes above $75,000 for a single taxpayer and $150,000 for married couples. A children's bonus would be included in the rebate check calculation. Anyone qualifying for the base amount would also receive an additional $300 per child, with no cap on the number of children.
Bonus Depreciation for Businesses: A 50 percent bonus deduction on new equipment in the year it is placed in service, with certain exceptions for equipment with a "long life." This provision expires at the end of this year. This tax relief provides an incentive to small businesses to invest now and create more jobs.
Small Business Expensing: Current law permits small businesses to immediately expense (rather than deduct over time), costs for the first $125,000 of purchases each year. Current law phases out that benefit, on a dollar-for-dollar basis, when purchases exceed $500,000. The agreement increases those limits for 2008, to $250,000 and $800,000. This provision expires at the end of this year. It would provide small businesses an incentive to invest now in their business so they can keep the workers they employ and create more jobs.