Two More Democrats Target Bank BonusesFebruary 16, 2010 - by Eric Naing
Two Senate Democrats are throwing another log on the now-annual firestorm over excessive bank bonuses.
Earlier this month, Sen. Jim Webb [D, VA] and Sen. Barbara Boxer [D, CA] unveiled a proposal to tax employee bonuses at certain banks and Wall Street firms that received bailout funds from the Troubled Asset Relief Program (TARP).
Dubbed the Taxpayer Fairness Act, Webb and Boxer’s bill would impose a one-time, 50 percent tax on the bonuses at those firms and banks that exceeded $400,000 last year. Only the amount of the bonus over $400,00 would be taxed.
Webb and Boxer aren’t the only Democrats with a plan to tax Wall Street and bank bonuses, however.
Rep. Dennis Kucinich [D, OH-10] has the Responsible Bankers Act (H.R.4414), which would impose a 75 percent tax on bank bonuses. Also, Rep. Peter Welch [D, VT-0] has the Wall Street Bonus Tax Act (H.R.4426), which imposes a 50% tax on bank bonuses over $50,000.
Just as the percentage of the bonuses tax seems to shrink with each successive bill introduced, the number of banks being targeted also decreases. Kucinich’s bill taxes “certain businesses." Welch’s bill narrows that to a tax on banks that received TARP funds.
Webb and Boxer’s bill further narrows that target to banks that received at least $5 billion in TARP funds. The Hill reports that just 13 banks would be taxed:
According to Boxer and Webb, there are 13 firms that would fall under their proposed tax because they received at least $5 billion in TARP money: American International Group (AIG), Bank of America, Citigroup, Fannie Mae, Freddie Mac, General Motors, GMAC, Goldman Sachs, JP Morgan, Morgan Stanley, PNC Financial, Wells Fargo and U.S. Bancorp.
You can read a draft of the bill here.