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Middle-Class Alternative Minimum Tax Relief Act of 2004

Floor Speech

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Location: Washington, DC

MIDDLE-CLASS ALTERNATIVE MINIMUM TAX RELIEF ACT OF 2004 -- (House of Representatives - May 05, 2004)

Mr. LINDER. Mr. Speaker, by direction of the Committee on Rules, I call up House Resolution 619 and ask for its immediate consideration.

The Clerk read the resolution, as follows:

H. Res. 619
Resolved, That upon the adoption of this resolution it shall be in order to consider in the House the bill (H.R. 4227) to amend the Internal Revenue Code of 1986 to extend to 2005 the alternative minimum tax relief available in 2003 and 2004 and to index such relief for inflation. The bill shall be considered as read for amendment. The previous question shall be considered as ordered on the bill and on any amendment thereto to final passage without intervening motion except: (1) one hour of debate on the bill equally divided and controlled by the chairman and ranking minority member of the Committee on Ways and Means; (2) the amendment in the nature of a substitute printed in the report of the Committee on Rules accompanying this resolution, if offered by Representative Rangel of New York or his designee, which shall be in order without intervention of any point of order, shall be considered as read, and shall be separately debatable for one hour equally divided and controlled by the proponent and an opponent; and (3) one motion to recommit with or without instructions.

The SPEAKER pro tempore (Mr. Kolbe). The gentleman from Georgia (Mr. Linder) is recognized for 1 hour.

Mr. LINDER. Mr. Speaker, for the purpose of debate only, I yield the customary 30 minutes to the gentleman from Florida (Mr. Hastings), pending which I yield myself such time as I may consume. During consideration of this resolution, all time yielded is for the purpose of debate only.

Mr. Speaker, H. Res. 619 is a modified, closed rule that provides for the consideration of H.R. 4227, the Middle-Class Alternative Minimum Tax Relief Act of 2004.

It provides for one hour of debate in the House, equally divided and controlled by the chairman and ranking minority member of the Committee on Ways and Means.

H. Res. 619 also provides for the consideration of the amendment in the nature of a substitute printed in the Committee on Rules report accompanying this resolution, if offered by the gentleman from New York (Mr. Rangel) or his designee, which shall be considered as read, and shall be separately debatable for one hour equally divided and controlled by the proponent and an opponent.

It waives all points of order against the amendment printed in the report and provides for one motion to recommit, with or without instructions.

Mr. Speaker, this is a fair and traditional rule for the consideration of legislation amending the Internal Revenue Code, and I hope that the House will approve the rule in order to have the opportunity to consider the merits of the underlying consideration.

The Alternative Minimum Tax was originally conceived as a means of ensuring that the wealthy "paid their fair share of taxes" in 1969. But, as has happened so many times in the past, the law of unintended consequences has meant that the AMT has produced a very different result.

Because the AMT is not currently indexed to the inflation rate, the number of taxpayers falling into the "AMT trap" is growing larger and larger every year. In 1970, 19,000 people paid the AMT. Today, this number has risen to over 3 million taxpayers. According to some estimates, approximately 35 million taxpayers will come under the AMT's procedures in the next 6 years.

These taxpayers are not wealthy by any stretch of the imagination. Increasingly, the AMT is punishing hard-working, middle class families.

With this in mind, I wanted to commend the gentleman from Connecticut (Mr. Simmons) for bringing H.R. 4227 to the floor today. This bill extends for 1 year the current limits on income exceptions from the AMT that Congress and President Bush enacted in 2001 and 2003. Notably, H.R. 4227 also indexes the limits for inflation, thereby precluding the AMT from taking an even bigger bite out of most moderate-income families' paychecks.

President Clinton's 1993 tax raise increased the AMT tax rate without adjusting the AMT exemption amount for inflation. Since then, however, the Republican majority in the Congress has repeatedly delivered AMT relief to taxpayers.

The Economic Growth and Tax Relief Reconciliation Act of 2001 increased the AMT exemption amounts, and the Jobs and Growth Tax Relief Reconciliation Act of 2003 further increased the AMT exemption amounts. These steps provided some relief to families, but for procedural reasons, the current law's AMT relief will expire next year if we do not enact H.R. 4227. While H.R. 4227 is a good proposal that deserves our support today because it will help provide much-needed AMT relief to workers, it is increasingly clear to me that the current income Tax Code is fatally flawed and in dire need of a fundamental overall.

To that end, I have introduced legislation, H.R. 25, that moves the Federal Government from an income tax-based system to a personal consumption system by abolishing all Federal income taxes and the IRS and replacing the Tax Code with a national retail sales tax on consumers buying new goods and services. Enacting the Fair Tax would, as just one example, solve the AMT problem for all families in the United States.

Mr. Speaker, I urge my colleagues to join me in supporting this rule so we may proceed with the debate on the underlying legislation.

Mr. Speaker, I reserve the balance of my time.

Mr. HASTINGS of Florida. Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I thank the gentleman from Georgia (Mr. Linder) for the time, and I rise today in opposition to the underlying bill and the closed rule providing for its consideration.

Once again, my friends on the Republican side have come to this floor in a restrictive manner stifling debate before it is even allowed to begin. The majority preaches fairness and inclusiveness while practicing and maintaining an agenda that divides and obstructs.

The gentleman from Georgia (Mr. Linder) previously suggested it is a fair rule because it allows for a Democratic substitute. With all due respect to the gentleman, this rule is anything but fair, and it is far from open. The rule does make in order an amendment offered by the gentleman from New York (Mr. Rangel), the ranking member on the Committee on Ways and Means. The Rangel substitute is far more encompassing than the Republican proposal, easier to understand, and most importantly, it pays for itself.

Despite making this amendment in order, the rule blocks the gentleman from Washington (Mr. Baird) from offering an amendment dealing with the deductibility of State income taxes or State sales taxes. Yesterday evening, the Baird measure came to the Committee on Rules. The gentleman from Washington asked that his amendment be made in order under the rule. In typical fashion, Republicans are blocking what they may not be able to defeat. Just like Shakespeare wrote, a rose by any other name would smell as sweet; a closed rule will always stink, and not even dozens of roses could blanket this stench.

The so-called Middle-Class Alternative Minimum Tax Relief Act that the House will consider later today is just another example of the majority's recklessly irresponsible tax agenda, not to mention creative naming practices. Even at first glance, this bill fails America's middle class. Folks, it raises taxes on the middle class. I do not know about the rest of my colleagues, but I have a pretty tough time making the argument in the district that I am proud to represent that a household income between $100,000 and $200,000 is middle class because in the district I represent, the average household income is barely $31,000.

In that district that I am proud to represent, $100,000 in household income is upper class by any definition; yet this is the income level that the majority continues to use as an example when making the case to eliminate the AMT.

The majority maintains that extending AMT exemptions help the middle class. I say it neglects America's real middle class. It raises their taxes. If Congress is serious about helping middle-class families, then it ought to use the $18 billion we are spending on the AMT extension this year alone and invest in the public schools which middle-class children attend. Congress should use the $18 billion and invest in health insurance for the 8.1 million uninsured middle-class Americans. Furthermore, 1-year fixes do not solve our problems. Over a 10-year period, this really will cost us $559 billion. It would be easier to eliminate the entire income tax. It would cost us less than what the Republicans are proposing under the AMT provisions that they offer.

Or if we really want to make a statement about our priorities, Congress should dedicate this $18 billion to the transportation reauthorization bill, a bill that a colleague of ours noted last week is currently stuck in a Republican legislative traffic jam. If we take this $18 billion and add it to the nearly $96 billion that we spent last week in eliminating the marriage tax, we have got ourselves more than 110 billion in new dollars to invest in America's transportation and infrastructure. At the same time, we would be creating some 4.6 million new jobs. Congress could have the $375 billion transportation bill that America needs without any increase in the gas tax and avoiding a Presidential veto. Instead, the majority chooses to cut taxes at the expense of our national priorities.

Mr. Speaker, I do not know any tax cuts that can teach high school algebra. I certainly cannot recall ever meeting a tax cut that could build a road. But I do know the Bush administration tax cuts, that 3 years of those have stalemated this body to the point that we are unable to adequately address long-term unemployment, an increasing number of uninsured people, escalating costs for health care, the uncertainty of an aging Social Security program, and an inadequate transportation system in this great country of ours. Three years of the Bush administration tax cuts have resulted in the largest deficit in the history of America, the greatest decline in household income in nearly 40 years, and an economy that is showing no immediate signs of recovery to help the more than 8 million unemployed Americans. Most important, tax cuts affect our ability to provide for America's military.

Let me send a message to President Bush and his minions. We cannot have guns and butter and ice cream as they propose. Our country has serious needs. Mr. Speaker, the underlying resolution neglects all of them. For that reason and that reason alone, Members should stand up against the interests of a few at the expense of all. I urge my colleagues to oppose this closed rule and reject the underlying resolution.

Mr. Speaker, I reserve the balance of my time.

Mr. LINDER. Mr. Speaker, I yield myself such time as I may consume to comment on the gentleman's opening statement. The gentleman from Washington did not show up at the committee to pursue his proposed amendment. And it is regular order for the Committee on Rules not to allow an open amendment process in bills that come out of the Committee on Ways and Means.

Lastly, let me just applaud the gentleman for saying we should get rid of the IRS. I welcome him as a cosponsor on H.R. 25.

Mr. Speaker, I reserve the balance of my time.

Mr. HASTINGS of Florida. Mr. Speaker, I yield myself such time as I may consume.

Most respectfully, my friend from Georgia has misspoken. If he reads my comment, he will understand that I said the Baird measure was proposed before the Committee on Rules last night. I was there like the gentleman from Georgia was. I do know, as a matter of fact, the gentleman from New York (Mr. Israel) presented the measure, and it was not accepted by us.

Mr. Speaker, I yield 3 minutes to the gentleman from Texas (Mr. Frost), the ranking member of the Committee on Rules.

(Mr. Frost asked and was given permission to revise and extend his remarks.)

Mr. FROST. Mr. Speaker, I thank the gentleman from Florida for yielding me this time.

The alternative minimum tax was originally intended to provide fairness for all taxpayers by requiring wealthy individuals to pay their fair share of taxes. Unfortunately, the alternative minimum tax is affecting more and more middle-class families. Middle-class families clearly should not be subject to the AMT, and I am glad we are looking at solutions to end this unfairness today.

But there is another tax issue that affects millions of Americans and that I think deserves the chance to be debated today, the issue of State sales tax deductibility. Since the sales tax deduction was eliminated in 1986, citizens from States that do not have State income taxes, such as my home State of Texas, have been unfairly punished. While taxpayers living in States that impose an income tax are entitled to deduct their State income taxes from their Federal tax bill, those living in States without income taxes do not receive an equivalent deduction for the sales tax. The result is that citizens of States like Texas, Florida, Washington State, and Tennessee are paying more to the IRS than are citizens of other States.

I do not think this is fair, Mr. Speaker. All taxpayers should be treated equally regardless of their State's tax system. A number of Members from both sides of the aisle have introduced measures to reinstate the sales tax deduction, and I think it is high time that this House consider their proposals.

Last night in the Committee on Rules, I offered an amendment to the rule brought forth by the gentleman from Washington (Mr. Baird). His amendment would restore fairness to the Federal tax system by allowing taxpayers who have no State income taxes to instead deduct their State and local sales taxes. Unfortunately, the Rules Committee majority defeated my amendment. Mr. Speaker, I do not think that is right. This House has debated dozens of other tax bills, but the Republican leadership will not allow this House to debate an issue that penalizes millions of American taxpayers.

Mr. Speaker, this is not a partisan issue. It is a matter of fairness. If this House is to be presented the tax bill of the week for the foreseeable future, I cannot understand why the Republican leadership will not allow the House to even consider an issue that will provide equity for the people of my State and six others. I think the American people deserve a full and honest debate on this matter.

Consequently, so that the House might be allowed to consider the sales tax deduction, we will attempt to defeat the previous question. If the previous question is defeated, we will offer an amendment to the rule allowing for the consideration of the gentleman from Washington's proposal to reinstate the State sales tax deduction for those States that do not have a State income tax. This may well be the only chance Members have to take a stand on this issue.

I urge my colleagues to vote "no" on the previous question so that this House may consider reinstating the sales tax deduction and so our constituents know where we stand on the issue of reinstating this deduction.

Mr. LINDER. Mr. Speaker, I reserve the balance of my time.

Mr. HASTINGS of Florida. Mr. Speaker, I note that all of my Republican colleagues who have such great interest in this AMT are just showing up in great numbers to speak on this measure.

Mr. Speaker, I yield 2 minutes to the gentleman from Tennessee (Mr. Cooper).

(Mr. Cooper asked and was given permission to revise and extend his remarks.)

Mr. COOPER. Mr. Speaker, I would urge all of our Members who are from Texas, Washington, Florida, South Dakota, Tennessee, Nevada, or Wyoming to pay close attention. This may be your best time, it may be your only time in your congressional career to get basic Federal income tax fairness for your State. Let me repeat. If you are from Texas or Florida or Wyoming or South Dakota or Tennessee or Washington, this may be your only chance to get basic tax fairness for the citizens of your State. This is not a partisan issue. This is an issue of basic unfairness that has existed in this country since 1986 when the tax laws changed to deprive the citizens of our States basic tax fairness.

The citizens of those States I just named, Texas, Florida, Tennessee, Washington, South Dakota, Nevada, Wyoming, pay more Federal income tax per capita than citizens equally positioned in other States. Why? Because our basic tax mechanisms are the sales tax, not the State income tax, and we cannot deduct the State sales tax from our Federal income. So this is your best chance, this is your only chance, and you must vote against the previous question. That idea is anathema to some of our colleagues, but I think we need to rise above the petty proceduralisms of this House, rise above what your House leadership may be telling you or not telling you; and this is a choice to stand up with your people back home or to obey the rules of Washington.

Let us stand up for our people back home. Let us get basic tax fairness to our citizens. To do that, you have to vote against the previous question. This is not an ordinary vote on a regular Wednesday in Washington, D.C. This is your best chance, this is your only chance to get tax fairness for your people back home.

Mr. LINDER. Mr. Speaker, I reserve the balance of my time.

Mr. HASTINGS of Florida. Mr. Speaker, I would urge our colleagues who are back in their offices and committees to come on down here and explain to the middle class in America why this AMT is not a tax increase on them.

Mr. Speaker, I yield 2 minutes to the gentleman from Tennessee (Mr. Davis).

Mr. DAVIS of Tennessee. Mr. Speaker, I compliment my colleague from Tennessee for the remarks he has just made. Having served in the Tennessee State legislature in both the House and the Senate, one of the issues that was debated and discussed so often in both of those chambers, in both the House and Senate in Tennessee, is how can we bring tax fairness from the Federal level to those of us who live in States that only fund education through a sales-tax-based revenue stream. Our Speaker of the Senate was so fond of saying, "Uncle Sam taxes taxes." In fact, that is exactly what this Congress and what this Federal tax structure does to States who choose not to have an income tax. We tax taxes. That is certainly not what we intend, but that is the fact. We allow States who impose an income tax, either local or on the State level, on individuals who live in those States a deduction for the tax that they pay in State taxes to be deducted from the Federal income tax, but we do not allow those of us who live in States such as Tennessee who choose to manage their governments better, perhaps, than most by not imposing a tax on income.

In this Nation, we tax assets, a person's home. We tax purchases of food and clothing in the State that I live in and nonprescription drugs. Other States tax income. We have chosen not to do that. As a result of the tax bill that passed in 1986, you are imposing a tax on tax for those of us who choose to manage our States better, perhaps, than other States. I ask my colleagues to vote against the previous question.

Mr. LINDER. Mr. Speaker, I would like to just take enough time to remind the gentleman that the 1986 tax act was called the Bradley-Gephardt bill.

Mr. Speaker, I reserve the balance of my time.

Mr. HASTINGS of Florida. The name of the bill, Mr. Speaker, does not make it any more correct. The problem still exists.

Mr. Speaker, I yield 2 minutes to the gentleman from Texas (Mr. Lampson).

Mr. LAMPSON. Mr. Speaker, I also want to say it does not matter what you call it. If it is inequity, it is inequity. If it is not fair, it is not fair. That is what I want to talk about this morning in this debate. We have lost the issue of a simple matter of equity and fairness.

I spent 19 years as a property tax collector in the State of Texas. My whole goal in assessing value to property was to make sure that no property owner, no taxpayer paid an unfair burden in comparison to the others. Our Tax Code unfairly penalizes those who live in States where there is no local or State income tax, which includes my State of Texas. Just as I cannot accept discrimination on how our government treats individuals, I do not want to accept discrimination in how our government taxes our citizens across the board. My colleague from Washington State knows this all too well, and that is why his proposed amendment is so important and timely, because it restores sales tax deductibility for residents of States with no local or State income taxes.

As current law stands, residents in States with local or State income taxes can deduct those amounts from their Federal taxes. So I ask you, where is the fairness for our hardworking, tax-paying citizens? Texas is one of nine States with no income tax; and as a result of the 1986 Federal tax reform law, regardless of who wrote it and who voted for it, that does not matter. That happened then, today is today. Sales taxes are not deductible. As a result, we are not treating all taxpayers in this country equally. Consider this: if Texans could deduct what they pay in State and local sales taxes, they could keep more than $700 million. That is a lot of money. That is money that the hardworking citizens of southeast Texas and the gulf coast region in my district could use to care for their senior citizens, pay their daily bills, use for unexpected emergencies, or even help offset our rising cost of school property taxes at home.

My colleague from Washington's proposed amendment offers a smart and simple fix and lets us remedy one part of our tax code so we can focus on reforming the rest of it. This money belongs to the residents of Texas, and by golly, if all other Americans get to deduct part of their taxes, then Texans should get to keep it as well. Let us vote against this previous question.

[Begin Insert]

And this amendment would be limited to just one year, so it is not a permanent measure-I cannot think of anything more reasonable for us to consider.

After all, that's what equity is all about, and since it seems lately that all we are considering are tax bills, well then we might as well consider this one too.

[End Insert]

Mr. LINDER. Mr. Speaker, I reserve the balance of my time.

Mr. HASTINGS of Florida. Mr. Speaker, how much time remains on each side?

The SPEAKER pro tempore (Mr. Kolbe). The gentleman from Florida (Mr. Hastings) has 14 minutes remaining, and the gentleman from Georgia (Mr. Linder) has 26 minutes remaining.

Mr. HASTINGS of Florida. Mr. Speaker, I yield myself such time as I may consume.

Twenty-six minutes for those people who believe in this measure to come down here and prove to America that their provision on the AMT is not a tax increase on middle class America, yet they are not using that time.

Mr. Speaker, I yield three minutes to the gentleman from Texas (Mr. Stenholm), my good friend and good student of this process.

(Mr. STENHOLM asked and was given permission to revise and extend his remarks.)

Mr. STENHOLM. Mr. Speaker, I rise in strong opposition to the previous question so the House might be able to consider the Baird amendment restoring the deduction for sales tax, State sales taxes.

This is one of those issues that I wish the Committee on Ways and Means would have brought to the floor of the House 2 years ago. The AMT question is a very serious question of which there is a lot of concern about. But this is not the way to handle it in the bill today and the tax cut of the week, and obviously the lack of participation by my friends on the majority side shows how political this is and how substance is being thrown away.

But I want to talk about the State sales tax deduction which was eliminated in 1986. Citizens from States that do not have State income taxes such as my home State of Texas have been unfairly penalized. While taxpayers living in States that have an income tax are entitled to deduct their State sales taxes from federal taxes, folks living in States without income taxes do not receive an equivalent deduction. And my State is now in the process of increasing the sales tax on all citizens of Texas, which will compound the problem that we are talking about today. The result is that citizens of States like my State of Texas are paying more taxes than are citizens in other States with identical incomes, and I do not understand why the Committee on Ways and Means does not take up the question of tax fairness.

The Baird amendment would restore fairness to the Federal tax system by allowing taxpayers who have no State income taxes to, instead, deduct their State and local taxes. Why not? What is wrong with that? Why not have a discussion of that on the floor instead of the tax cut of the week, which is purely for political purposes that will show up in campaign ads all over the United States as evidenced by the lack of participation in the substance of that which we are talking about today?

I also believe that the fundamental bill, if we are going to have to, on the floor, ought to be paid for. I agree that this exemption of State sales taxes will cost an estimate of $1.2 billion, but it ought to be paid for and it should be paid for in the interest of fairness. States should be able to decide for themselves whether or not they want to adopt an income tax instead of being pressured to do so because the Tax Code is biased in favor of a State income tax instead of a State sales tax.

What is wrong with that picture? Why can we not have a serious debate

on this floor about tax reform? Instead of just talking about it in campaign slogans, which we do, flat tax, et cetera, a fundamental question, why can the Committee on Ways and Means not take up the bill that they bring to the floor today and have a serious discussion of that within the committee? Why not let Members in a bipartisan way participate in these issues? Instead, it is a campaign issue. If they want a campaign issue, this is a campaign issue.

In Texas, the inability of Texans to deduct sales taxes should be an issue on the hearts and minds of every single Texan, and the vote on the previous question will clearly identify in this body who is in favor of fairness and who is not.
Vote against the previous question. Allow fairness to be discussed on the House floor.

Mr. LINDER. Mr. Speaker, I reserve the balance of my time.

Mr. HASTINGS of Florida. Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, by continuing the exemption for another year, 1 year, Republicans are incrementally trying to postpone the day of reckoning with the AMT. At some point a decision will have to be made to, number one, repeal some of President Bush's tax cuts or, number two, index the AMT for inflation at a cost of roughly $370 billion or, number three, eliminate the AMT altogether at a cost of $600 billion without the Bush tax cuts, or $900 billion if President Bush's tax cuts remain beyond 2010.

What I just said is a part of inside baseball that at best we could feed to the goats the language that we employ here. The mythical Ms. Johnson and Jane and Joe Lunch Bucket understand only one thing and one thing only, that we need to have a debate on how it affects them. No one comes into my office talking about an AMT. But people come into my office talking about health care. People come into the office of our all of us talking about education. People come to our offices to talk about supporting the military in an adequate fashion. And countless, thousands, of Americans come to us talking about either being uninsured or needing to have incentives for small businesses. And yet we find ourselves unable to have a discussion in this House of Representatives that is meaningful as far as economics are concerned. What we get are campaign gimmicks and fancy names of things that do not become the law.

This measures has passed the House of Representatives before. If the American people wanted it to be law, they would be in our offices saying they want this to be the law. We cannot get ten people in most of our communities to write a decent paragraph on what the alternative minimum tax really is. I dare say we could not get a whole lot of Members of the House to do likewise.

With that in mind, it is a confusing set of circumstances that is a 1-year fix. If you think so much of it, why did you stay in your offices and not come down here and explain to the American public why the middle class will not experience a tax increase over the haul of 10 years? What you do is you reduce the income taxes, then you eliminate the AMT on one hand and you take from the right hand and give to the left hand.

To correct my friend from Georgia, who will have the last word on this subject, correctly so, because he and his Members are in the majority, let me give him a summary of the motion that he brought to the House of Representatives. It says "Providing for Consideration of H.R. 4227, Middle-Class Alternative Minimum Tax Relief Act of 2004, Mr. Linder, from the Committee on Rules, submitted the following."

I shall not read the entire report, but since he took it upon himself to say that the Baird measure was not before us, I shall only refer to the language of the motion offered by the gentleman from Texas (Mr. Frost) last night when the gentleman from Georgia (Mr. Linder) and I were in the Committee on Rules.

"Summary of motion: To make in order and provide the appropriate waivers for the amendment offered by Representative Baird." Do not challenge me when I say that that was what was brought to us. That measure was defeated six to five by the majority, and I say today we have a chance to remedy that problem if Members, particularly those from Florida, were to see my Republican colleagues from Florida come down here and say that this is not a sound measure when all we have is a sales tax and right up the street somebody else with an income tax can deduct it from their Federal tax offering and we are unable to do this so. Fair is fair. This measure is not fair.

Mr. Speaker, I will be asking Members to vote "no" on the previous question. If the previous question is defeated, I will offer an amendment to the rule that will allow the House to vote on the Baird sales tax equity amendment that was offered in the Committee on Rules last night but not allowed by the Republican leadership. I think Members deserve an opportunity to vote on this important amendment. I want to point out that this is not a partisan amendment. It has support from both sides of the aisle as was demonstrated in the Committee on Rules vote yesterday.

The Baird amendment would allow taxpayers who itemize their deductions the option to deduct their State income tax or sales taxes paid in a given year. The option for deduction of sales taxes was available to taxpayers until 1986 when it was eliminated. The gentleman from Georgia (Mr. Linder) said that the gentleman from Missouri's (Mr. Gephardt) name was on that. I remind him that it was signed by President Ronald Reagan. However, taxpayers in those States with a State income tax still retain the ability to deduct those taxes. The loss of the State sales tax option was particularly tough for taxpayers in States with no income tax like my own State of Florida.

As a result, people in my State and others similarly situated pay more taxes than people with identical taxable incomes in States that have a State income tax. It is very important that we equalize the tax relief for citizens in those States without the State income taxes.

Let me emphasize that a "no" vote on the previous question will not stop consideration of H.R. 4227, the Middle-Class Alternative Minimum Tax Relief bill. But it will allow the House to vote on reinstating the sales tax deduction option and correct the current tax inequity. But a "yes" vote will block Members from an up or down vote on this important tax relief.

Again, I urge a "no" vote on the previous question.

Mr. Speaker, I ask unanimous consent that the text of the amendment be printed in the RECORD immediately prior to the vote on the previous question.

The SPEAKER pro tempore. Is there objection to the request of the gentleman from Florida?

There was no objection.

Mr. HASTINGS of Florida. Mr. Speaker, I yield back the balance of my time.

The material previously referred to by Mr. Hastings of Florida is as follows:

In the resolution strike "and (3)" and insert the following:
"(3) the amendment printed in Sec. 2 of this resolution if offered by Representative Baird of Washington or a designee, which shall be in order without intervention of any point of order, shall be considered as read, and shall separately debatable for 30 minutes equally divided and controlled by the proponent and an opponent; and (4)"
SEC. 2. The amendment referred to in (3) follows:
At the end of the bill insert the following new section:
SEC. 3. DEDUCTION OF STATE AND LOCAL GENERAL SALES TAXES IN LIEU OF STATE AND LOCAL INCOME TAXES.
(a) IN GENERAL.-Subsection (b) of section 164 of the Internal Revenue Code of 1986 (relating to definitions and special rules) is amended by adding at the end the following:
"(5) GENERAL SALES TAXES.-In the case of taxable years beginning during 2004, for purposes of subsection (a)--
"(A) ELECTION TO DEDUCT STATE AND LOCAL SALES TAXES IN LIEU OF STATE AND LOCAL INCOME TAXES.-
"(i) IN GENERAL.-At the election of the taxpayer for the taxable year, subsection (a) shall be applied-
"(I) without regard to the reference to State and local income taxes,
"(II) as if State and local general sales taxes were referred to in a paragraph thereof, and
"(III) without regard to the last sentence.
"(B) DEFINITION OF GENERAL SALES TAX.-The term 'general sales tax' means a tax imposed at one rate with respect to the sale at retail of a broad range of classes of items.
[Page: H2560]
"© SPECIAL RULES FOR FOOD, ETC.-In the case of items of food, clothing, medical supplies, and motor vehicles-
"(i) the fact that the tax does not apply with respect to some or all of such items shall not be taken into account in determining whether the tax applies with respect to a broad range of classes of items, and
"(ii) the fact that the rate of tax applicable with respect to some or all of such items is lower than the general rate of tax shall not be taken into account in determining whether the tax is imposed at one rate.
"(D) ITEMS TAXED AT DIFFERENT RATES.-Except in the case of a lower rate of tax applicable with respect to an item described in subparagraph ©, no deduction shall be allowed under this paragraph for any general sales tax imposed with respect to an item at a rate other than the general rate of tax.
"(E) COMPENSATING USE TAXES.-A compensating use tax with respect to an item shall be treated as a general sales tax. For purposes of the preceding sentence, the term 'compensating use tax' means, with respect to any item, a tax which-
"(i) is imposed on the use, storage, or consumption of such item, and
"(ii) is complementary to a general sales tax, but only if a deduction is allowable under this paragraph with respect to items sold at retail in the taxing jurisdiction which are similar to such item.
"(F) SPECIAL RULE FOR MOTOR VEHICLES.-In the case of motor vehicles, if the rate of tax exceeds the general rate, such excess shall be disregarded and the general rate shall be treated as the rate of tax.
"(G) SEPARATELY STATED GENERAL SALES TAXES.-If the amount of any general sales tax is separately stated, then, to the extent that the amount so stated is paid by the consumer (other than in connection with the consumer's trade or business) to the seller, such amount shall be treated as a tax imposed on, and paid by, such consumer.
"(H) AMOUNT OF DEDUCTION TO BE DETERMINED UNDER TABLES.-
"(i) IN GENERAL.-The amount of the deduction allowed under this paragraph shall be determined under tables prescribed by the Secretary.
"(ii) REQUIREMENTS FOR TABLES.-The tables prescribed under clause (i)--
"(I) shall reflect the provisions of this paragraph,
"(II) shall be based on the average consumption by taxpayers on a State-by-State basis, as determined by the Secretary, taking into account filing status, number of dependents, adjusted gross income, and rates of State and local general sales taxation, and
"(III) need only be determined with respect to adjusted gross incomes up to the applicable amount (as determined under section 68(b)).".
(b) EFFECTIVE DATE.-The amendments made by this section shall apply to taxable years beginning after December 31, 2003.
Amend the title so as to read: "A bill to amend the Internal Revenue Code of 1986 to extend to 2005 the alternative minimum tax relief available in 2003 and 2004 and to allow a temporary election to deduct State and local general sales taxes in lieu of deducting State and local income taxes.".

Mr. LINDER. Mr. Speaker, I yield myself such time as I may consume.

I merely point out that the majority party will be here to discuss the merits of the bill. The last debate has been on the rule, irrespective of the debate we heard from the other side, which was neither on the rule nor on anything in the rule nor on the merits of the bill. So I will urge my colleagues to come and pass the previous question, pass the rule, and get on with the debate on the bill, which is the extension of the AMT exclusion.

Mr. Speaker, I yield back the balance of my time, and I move the previous question on the resolution.


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