Washington, DC —
Senator John Thune today issued the following statement regarding Democrat obstruction of the "Family Prosperity Act." The economic package included a permanent reduction of the estate tax, an extension of the state sales tax deduction, and an increase of the minimum wage. The package failed in the Senate by a vote of 56 to 42. Sixty votes were needed to overcome a Democrat filibuster.
"The economic package on the floor today was a fair compromise measure that would have directly benefited South Dakota farmers, businesses, and families." Thune said. "Farmers and small businesses owners in South Dakota are sure to be disappointed when they hear the burdensome death tax was not reduced because of politics and partisan obstruction.
"This package would have also lowered taxes for all South Dakotans who itemize on their taxes by extending their ability to deduct state and local sales taxes in lieu of state and local income taxes. But because of Democrat obstruction, tens of thousands of South Dakota taxpayers now face higher taxes.
"Today, Republicans offered a compromise solution on death tax reform and a minimum wage increase. Unfortunately, Senate Democrats were not willing to meet us half way and instead they put politics before good policy."
Provisions of the Family Prosperity Act included:
Permanent Death Tax Relief - Compromise prevents death tax rate from rising to 55% top rate and exemption dropping to $1 million in 2011.
Extension of Tax Relief
Minimum Wage Increase
"The economic package on the floor today was a fair compromise measure that would have directly benefited South Dakota farmers, businesses, and families." Thune said. "Farmers and small businesses owners in South Dakota are sure to be disappointed when they hear the burdensome death tax was not reduced because of politics and partisan obstruction.
"This package would have also lowered taxes for all South Dakotans who itemize on their taxes by extending their ability to deduct state and local sales taxes in lieu of state and local income taxes. But because of Democrat obstruction, tens of thousands of South Dakota taxpayers now face higher taxes.
"Today, Republicans offered a compromise solution on death tax reform and a minimum wage increase. Unfortunately, Senate Democrats were not willing to meet us half way and instead they put politics before good policy."
Provisions of the Family Prosperity Act included:
Permanent Death Tax Relief - Compromise prevents death tax rate from rising to 55% top rate and exemption dropping to $1 million in 2011.
- A $5 million exemption per spouse, indexed for inflation
- Uses the Capital Gains tax rate (which is 15%) on amounts up to $25 million
- A 30% fixed tax rate over $25 million
- Unify Estate and Gift Tax to simplify planning
Extension of Tax Relief
- State and Local Sales Tax Deduction
- Research & Development Tax Credit (simplified & extended)
- College Tuition Deduction
- Work Opportunity Tax Credit
- Welfare to Work Tax Credit
- Depreciation for Restaurants
- Timber Capital Gains
- Abandoned Mine Land
- Mine Safety Tax Incentives
- Teachers Classroom Expenses deduction
- Combat Pay applies to EITC
- Gulf Opportunity Zone (Katrina Tax Credits)
Minimum Wage Increase
- Increases the minimum wage from current $5.15 wage per hour to $7.25 over 36 months in three increments of 70 cents
- Minimum Wage Tip Credit included
