Republican Substitute Would Eliminate Meaningful Tax Relief To Middle Class Families

Posted on by Karina

During consideration of the American Recovery and Reinvestment Act, the House debated a substitute offered by House Republicans which would cut tax relief for working Americans and eliminate targeted investments in infrastructure, LIHEAP, food stamps, health IT, and clean, efficient American energy provided by the American Recovery and Reinvestment Act. The Republican substitute failed by a vote of 170-266.

Rep. Earl Blumenauer on the Republican substitute:

Rep. Blumenauer:
“I’m glad, however, that they’ve offered this alternative because it puts in clear relief what their priorities are – take money away from 95% of the American public and invest in the few who need it the least. Take money away from 4 million students who would have this tax relief. And my favorite, is actually continue to game the alternative minimum tax to purposely push more people into it, with tax gimmicks -rather than work with us in fundamental tax reform that doesn’t subject more people, and give us this biannual charade.”

Rep. Sander Levin on the Republican substitute:

Rep. Levin:
“You're going have to go back to Michigan and say to at least 25,000 families, health care provided under the Democratic approach, and I hope a bipartisan approach, will be eliminated.”

Rep. Richard Neal on the Republican substitute:

Rep. Neal:
“We were looking at a $5.7 trillion surplus that debt had gone down and deficits had been eliminated. Now their argument is, and they cling to it, tax cuts pay for themselves. And now they look at a debt of $10 trillion.”

Rep. Bill Pascrell on the Republican substitute:

Rep. Pascrell:
“This substitute continues the practice of providing tax cuts for the wealthiest American and it ain't going to happen anymore.”

From the Committee on Ways and Means:

The Republican substitute amendment to H.R. 1, the American Recovery and Reinvestment Act of 2009, would eliminate meaningful tax relief to middle-class families and deny critical benefits those who have lost their jobs and health insurance due to the economic crisis. Further, the GOP substitute fails to create jobs by eliminating critical investments in America's infrastructure, Health IT, and renewable energy technology. Finally, the GOP bill claims to offer “relief” from the alternative minimum tax (AMT), when in fact their “relief” would still force 26 million Americans to pay higher taxes this year under the AMT.

“The Republican substitute cuts nearly all forms of assistance to middle-class families struggling during the downturn,” said Charles B. Rangel (D-NY), Chairman of the Ways and Means Committee. “It gives $48 billion in tax cuts to those who are prospering even in this economic downturn, lobbyists on K Street, lawyers, and high-paid professionals, while denying critical assistance to the people who work for them.”

According to a Center on Budget and Policy Priorities analysis, roughly 23 million lower-income taxpayers would receive nothing at all under the GOP substitute, compared to legislation written by House Democrats which would cut taxes for 95% of all working families under the “Making Work Pay” credit.


Eliminates the “Making Work Pay” tax credit that will provide 95% of working families with a tax cut. Under the Republican substitute, only about the top fifth (21%) of households would get the full tax cut.

Eliminates tax relief for 16 million children by striking the child tax credit improvements.

Eliminates the “American Opportunity” tax credit that will provide tax relief for more than 4 million students.

Eliminates COBRA Provisions that would help maintain health insurance for people who have lost their jobs in this recession.


The Republican substitute would completely eliminate $550 billion in targeted priority investments included in H.R. 1 for (1) clean, efficient, American energy, (2) transforming our economy with science and technology, (3) modernizing roads, bridges, transit and waterways, (4) education for the 21st century, (5) lowering healthcare costs, (6) helping workers hurt by the economy and (7) saving public sector jobs and protect vital services.

Eliminates investments in clean, efficient, American energy

Eliminates investments in Health IT

Eliminates projects to modernize schools, roads, bridges, transit and waterways


The so-called “AMT relief” in the Republican substitute is dishonest. Under the “AMT relief” provided under the Republican substitute, the number of taxpayers affected by the AMT would grow to 26 million taxpayers in 2009 and 28 million taxpayers in 2010 — six times as many taxpayers as in 2008. Last year, Congress provided AMT relief to ensure that the AMT did not grow beyond the 4.2 million taxpayers that were already affected by the AMT. A six-fold increase in the number of taxpayers that are subject to the AMT is hardly tax relief — ask the 26 million taxpayers who would pay the AMT in 2009.

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