This vote was on an amendment by John Thune, R-S.D., that would put the Senate on record as endorsing the opinion that Congress should preserve the full federal income tax deduction for charitable giving. These types of "sense of the Senate" amendments are not binding. The amendment was offered to a bill that would reauthorize the Corporation for National and Community Service programs (which includes VISTA and AmeriCorps).
Thune said he offered his amendment as an alternative to a similar amendment offered by Max Baucus, D-Mont., that would put the Senate on record as endorsing the opinion that the tax law shouldn't be changed to discourage taxpayers from making charitable contributions, but does not express that it should be "fully" deductible, as does Thune's.
Thune said that he is concerned that President Obama's budget, which will soon be released, will have a goal "to try to find ways to generate revenue to do other things," including from the charitable contributions income tax credit. "I think this is a bad place to get it. I do not think the savings you are achieving as a result of taking away this tax benefit to charitable giving in the long run is going to in any way offset the decrease we are going to see from people across this country who might otherwise make charitable contributions who, because you take away that tax benefit, are going to see the actual cost of those contributions go up and therefore affect the amount they might otherwise give," Thune said.
He gave an example of a study showing that repealing the estate tax – which requires heirs to pay tax on certain high-value estates they inherit – would also decrease charitable giving. "Should we not scale back the estate tax anyway? Of course we should. But the Senator’s amendment would put the Senate on record that we always want to encourage charitable giving rather than discourage it, which would put a big limitation on reducing the death tax," Thune said.
Baucus said the nation has a proud tradition of charitable giving, and that it should continue to be encouraged.
"Thankfully, many taxpayers make charitable contributions, even though they are not getting any tax benefit at all. Indeed, one might say the greatest charity is when someone gives from the heart rather than just when it is tax deductible. So we do not need the extreme statement in the Senator’s sense-of-the-Senate amendment," Baucus said. "I have offered a side-by-side amendment that emphasizes Congress’s continued support of tax incentives for giving. Let’s show our support for charitable giving without making the categorical statement in the Thune amendment."
By a vote of 48-49, Thune’s amendment was rejected. Every Republican present voted for the amendment. Of Democrats present, all but six against the amendment. The end result is that the bill went forward without language expressing the opinion that Congress should preserve the full federal income tax deduction for charitable giving. (The Baucus amendment was adopted, see vote 112.)