What: All Issues : Making Government Work for Everyone, Not Just the Rich or Powerful : Insuring Government Has Adequate Financing to Function : Fair Minimum Wage Act of 2007 (H.R. 2), Sen. Gordon Smith (R-Ore.) amendment to make permanent tax deductions for out-of-pocket expenses teachers incur to provide supplies for their classrooms and expansions of certain other education tax credits/Motion to waive the Budget Act (2007 senate Roll Call 30)
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Fair Minimum Wage Act of 2007 (H.R. 2), Sen. Gordon Smith (R-Ore.) amendment to make permanent tax deductions for out-of-pocket expenses teachers incur to provide supplies for their classrooms and expansions of certain other education tax credits/Motion to waive the Budget Act
senate Roll Call 30     Jan 25, 2007
Progressive Position:
Nay
Progressive Result:
Win

This vote was on an amendment proposed by Gordon Smith (R-Ore.), Sen. Susan Collins (R-Maine) and John Warner (R-Va.), to a bill to increase the minimum wage to $7.25 per hour over the next two years. Their proposal would increase the amount school teachers are allowed to deduct from their federal income taxes for out-of-pocket expenses they incur for their classrooms from $250 a year to $400 a year. The amendment would also make the tax deduction permanent. It is currently set to expire at the end of 2007. The amendment also included expansions of other education tax credits and tuition savings accounts.

"Teachers who buy classroom supplies in order to improve the educational experience for their students deserve more than just our gratitude. They deserve this modest tax incentive to thank them for their hard work," said Collins. She cited a study done by the National School Supply and Equipment Association that found that on average educators spend a total of $1,700 out of their own pockets on their classrooms every year.

Finance Committee Chairman Max Baucus (D-Mont.) agreed with Collins that "education is one of our country's highest priorities," but added that the amendment "is not the right way to address this issue."

Baucus' first complaint was that the amendment was not offered first in committee, meaning there had been no hearings on it.

"The committee has not had a chance to work on the amendment, and it shows. First, the amendment is not paid for," Baucus said. "It would increase the deficit by $35 billion over 10 years. No. 2, it leaves in place overly complex tax provisions. It needs simplification. We clearly need to consolidate the myriad different education credits and deductions with which the people in the country are faced and have an almost impossible time trying to figure out. This amendment does not do the job."

Baucus said the biggest problem with the proposal was it didn't get at the core of the problem, low teacher pay. " That is the real solution here, rather than saying you have to get a deduction so you can help pay for your students' expenses," he continued.

Because Smith's amendment would amount to a $35 billion tax cut, it was vulnerable to a parliamentary procedure known as a point of order. Under rules put in place by the 1974 Congressional Budget Act, unless a tax break or spending increase is offset by spending cuts or revenue increases elsewhere in the federal budget, the Budget Act has to be waived. On those grounds, Baucus raised a point of order against Smith's amendment. By law, a three-fifths majority of the whole Senate (60 votes) is required to waive the Budget Act.

By a vote of 43-50, the Senate voted against waiving the Budget Act to allow for Smith's amendment. Three Republicans joined all but one Democrat in voting against the proposal. Thus, the bill to raise the minimum wage to $7.25 over the next two years went forward without a provision that would have expanded education tax credits and increased the amount teachers are allowed to deduct from their federal income taxes for out-of-pocket expenses for their classrooms.

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