John B. Breaux: “I rise today to address the full Senate and the distinguished chairman of our Finance Committee, Senator Roth. On June…”

“I rise today to address the full Senate and the distinguished chairman of our Finance Committee, Senator Roth. On June 5, I suggested to the Finance Committee that it adopt a provision that would permit subchapter S corporations to sponsor ESOP's, or employee stock ownership plans. When the precise language of my proposal was published as section 1316 of H.R. 3448, I was disappointed to read that some of the special tax benefits that currently are available with respect to ESOP's would not be available in the case of an ESOP that acquires and holds subchapter S corporation stock. I would like to note that the provision in the bill before us related to employer securities and sub S ERISA plans is not to take effect until January 1, 1998. Between now and then, I will review how we can make it possible for subchapter S corporations to avail themselves of the special ESOP tax benefits, which will encourage greater use of this provision. After this review, I hope to be able to offer reasonable alterations to H.R. 3448 that will expand our policy of promoting employee ownership through ESOPs.”