Max Baucus: “tomorrow, an amendment will be offered--I am not sure by whom; it may be Senator Nickles from Oklahoma--which…”

“tomorrow, an amendment will be offered--I am not sure by whom; it may be Senator Nickles from Oklahoma--which accelerates the dividend exclusion provisions considerably beyond the provisions that are in the Finance Committee bill. Our understanding is it is a 50 percent exclusion in the first year, 2003, and 100 percent up through 2006, and after that the provision will be sunsetted. I will make a couple of comments because we will not have time to comment on it tomorrow at any length. One is that this is a significant increase from the committee bill, which costs $80 billion. My understanding is that this amendment will cost in the neighborhood of $124 billion. How is the $40 billion difference going to be paid for? Clearly, there is going to have to be cutting back on other tax cuts--whether it is the marriage penalty or whatever--to bring that to the attention of Members who may believe it is better to have a child tax credit or a marriage penalty and whatnot. And I have not seen the amendment, so I am not exactly sure of the provisions, but from all indications, it will eliminate the provisions in the President's dividend exclusion, which will require that before a dividend can be paid, a company would have to pay income taxes in the prior year.”