Webb, Boxer TARP tax unlikely on jobs bill

The Senate will likely not consider an amendment this week that would impose a 50 percent tax on bonuses at firms that received large taxpayer bailouts, Senate Democratic sources said.

The amendment, sponsored by Democratic Sens. Jim Webb (Va.) and Barbara Boxer (Calif.), would levy a one-time tax on bonuses exceeding $400,000 at firms that received at least $5 billion in bailout money.

The financial industry and U.S. Chamber of Commerce lobbied against the tax provision, arguing it would hurt the recovery and drive up costs for consumers. The House passed a tax provision last year on bailout recipients following the public outcry surrounding hundreds of millions of dollars in bonuses at crippled insurer AIG.

The Senate never passed a comparable measure.

The tax sponsored by Webb and Boxer would apply to roughly a dozen companies, including Goldman Sachs, Fannie Mae, Freddie Mac, AIG and General Motors, a mong others. The tax could raise between $3.5 billion and $10 billion, Webb’s office said.

Webb plans to push for the tax measure to be added to future legislation, including possibly the next “jobs bill” considered in the Senate.