Senate Democrats push bonus tax on TARP firms

Senate Democrats are pushing a bonus tax on bailed-out firms as part of financial overhaul legislation.

The legislation is supported by Democratic Sens. Jim Webb (Va.), Barbara Boxer (Calif.), Dick Durbin (Ill.), Patty Murray (Wash.), and Blanche Lincoln (Ark.). Sen. Bernie Sanders (I-Vt.) also supports the measure, which was first introduced by Webb and Boxer.

The legislation would put a one-time tax on bonuses paid in 2010 to executives at financial institutions that received $5 billion or more from the $700 billion financial bailout package. The 50 percent tax would fall on bonuses in excess of $400,000.

"It is a targeted, sensible approach to ensure that the taxpayers who made possible the success of the biggest financial institutions benefit from that success--not just the executives of those institutions," Webb said in a statement.