AMT Patched, Taxpayers Win
Congress passes temporary fix to AMT without Democrat tax increases

WASHINGTON, D.C. – In a victory for taxpayers, last night Congress passed a patch to the Alternative Minimum Tax (AMT), preventing 23 million Americans from being hit with the tax this year.  By waiving Democrat pay-go rules, the temporary tax fix was accomplished without permanently raising other taxes, despite opposition from the majority party.

Rep. Charles Rangel (D-N.Y.) argued for a surtax of up to 4.6 percent on families earning as little as $150,000 per year.  Several Republican congressmen promoted measures to fix the AMT without raising taxes.    The House Republican Study Committee (RSC) introduced H.R. 3818, the “Taxpayer Choice Act of 2007.”  This bill would repeal the AMT, and implement an optional “simplified income tax” system with a top rate of only 25% (15% for capital gains and qualified dividends).

 “The temporary patch is a major victory for taxpayers, considering the tax hikes Democrats in Congress were pushing,” said Grover Norquist, president of Americans for Tax Reform. “The House Republican Study Committee’s ‘Taxpayer Choice Act’ is a pro-growth way to permanently fix the AMT – by eliminating it.”

The AMT was created by Democrat President Lyndon Johnson as a tax on a handful of Americans with high incomes.  Later, President Clinton raised the AMT from 24 to 28 percent with the help of members of Congress such as Rep. Nancy Pelosi (D-Calif.), Rep. Rangel  and Sen. Reid (D-Nev.). 

“Right now, 40 percent of AMT taxpayers are paying this tax solely because of the 1993 Clinton AMT tax increase.  Raising taxes again will create drag on the economy and will not fix the problem,” continued Norquist. “The next step is to repeal the onerous AMT and replace it with a simplified income tax.”