The Senate also defeated an amendment to impose a windfall profits tax on oil companies and use the money to fund a low-income heating assistance program.
Senators rejected other proposals that would have eliminated a tax incentive for major oil and gas companies that allows them a credit for exploration and development costs. An amendment to ban price- gouging during national energy emergencies declared by the president won the support of 57 senators but fell short of 60 votes needed to overcome a procedural hurdle.
The overall bill reduces taxes about $60 billion over five years, preserving many tax breaks scheduled to expire unless lawmakers keep them intact. Unlike a version scheduled for debate in the House on Friday, the bill would not extend reduced tax rates for capital gains and dividends. Congress lowered the maximum tax rate on that investment income to 15 percent in 2003, and many Republicans want to act this year to keep those rates in place in 2009 and 2010.
The bill also would offer $7 billion in assistance to businesses and individuals hit by Hurricane Katrina and other storms, filling in details of President Bush's proposed Gulf Opportunity Zone.
Among many provisions extended in the bill are a deduction for state and local sales taxes, investment incentives for small businesses, a business research and development credit and a tuition deduction. Taxpayers would get new incentives to make charitable contributions at the same time that tax-writers put new curbs on charitable deductions deemed excessive.
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The bill is S. 2020
Congressional information on the Net: http://thomas.loc.gov/
