Snowe withholds opinion on extender bill

Sen. Olympia Snowe (R-Maine) on Thursday was undecided about supporting legislation that extends several tax and spending measures and expressed some concern on how the bill intends to raise taxes on carried interest.

"I'm concerned about anything that raises costs of doing business these days," she said. "I know they [Democrats] express concerns about taxes going up, spending going up, and deficits; but on the other hand it seems to be moving in the opposite direction of raising taxes and spending more." 

Snowe is one of a handful of centrist Republican senators that Democratic leaders hope will ultimately support the legislation. 

At least one Republican vote is needed for passage, assuming all 59 Senate Democrats back the bill. 

The term "carried interest" describes a manager's share of profits in certain types of partnerships. Payouts are currently taxed at the 15 percent of capital gains rate, but Democrats want the levy to resemble ordinary income rates, which are expected to be more than 39 percent next year. 

The extender bill seeks to eventually raise the tax on carried interest to ordinary income rates. The provision raises approximately $20 billion and would help pay for the extension of a number of individual and business tax breaks that expired in January. 

Snowe said there should be an alternative to using tax increases to pay for the extension of other tax cuts. 

"The fact is there has to be a way of addressing these issues without constantly raising the cost of government and the cost to the taxpayer," she said, adding, "We need to go in the other direction and that is my concern."

Aside from Snowe, Democratic leaders are hoping to win support from GOP centrists such as Sens. Susan Collins (Maine), George Voinovich (Ohio) and Scott Brown (Mass.), said a Democratic aide.