Senate Panel OKs Business Tax Breaks

Rangel, D-N.Y., said the Senate must try to pass the bill as a stand-alone measure without the tax provisions.

"We're not going to accept a tax cut of $8 billion on our minimum wage bill," Rangel said. "It's a Senate problem."

House leaders want to avoid long delays in enacting the minimum wage increase. They are sending signals privately that they ultimately will accept some tax provisions rather than risk deadlock.

The Senate measure also would scale back the ability of corporate executives to postpone paying taxes on deferred compensation plans, limiting the amount of deferrable income to $1 million. This would raise $806 million over the next decade.

Rolling back the plans, which are popular with highly paid executives, led to objections from the business lobby.

All told, the Senate measure would provide about $8 billion in tax incentives for small business by extending the ability of small businesses to defray the cost of equipment purchases. It would allow restaurant and store owners _ who typically hire many minimum wage workers _ accelerated tax benefits on improvements to their facilities.

The measure would extend for five years the work opportunity tax credit. This gives businesses tax relief for hiring people that employers often are reluctant to take on _ welfare recipients, ex-felons, the mentally and physically disabled and inner city youths, for example.

Under both the House and Senate bills, the minimum wage would rise to $5.85 an hour 60 days after it signed into law by the president; then to $6.55 an hour a year later; and to $7.25 an hour a year after that.