Max Baucus: “let me read a quote of American Enterprise Institute, conservative economist, commenting on this amendment: Clearly…”

“let me read a quote of American Enterprise Institute, conservative economist, commenting on this amendment: Clearly, this proposal is one of the most patently absurd tax policies ever proposed. That is AEI, Republican economist, commenting on this amendment. Why say that? First, this amendment goes far beyond any other attempt to eliminate double taxation of dividends. What is the effect of this amendment? The effect of this amendment is in many cases to not only eliminate double taxation of dividends but to also eliminate single taxation of dividends. In many cases, as a consequence of the way this amendment is written--which we saw just for the first time half an hour ago--is to say there is no taxation on many dividends offered by corporation shareholders, not the shareholder paying any tax, and not the corporation paying any tax. Second, who subsidizes this if that is the nontaxation of dividends under this proposal? Americans are subsidizing this. Who? Americans today who otherwise would receive the relief under the marriage penalty contained in this bill are going to be subsidizing and paying for, in effect, these tax-free dividends. That is because that is the pay-for in this bill. In addition, this bill increases the budget deficit so our children will be paying for many of those tax-free dividends contained in this bill. Next, this is a huge yo-yo tax provision.…”