The Senate overwhelmingly
passed two smaller parts of President Obama's jobs bill today, a repeal of a withholding tax on companies receiving government contracts, and a tax credit for business which hire veterans.
The final vote was 95-0 with one senator [Olympia Snowe, R-ME] voting "present. The legislation, which is expected to pass in the House, will provide tax credits to businesses who hire unemployed veterans, and, separately, will eliminate a requirement that the IRS withhold three percent of government contracts, to assure compliance with the tax code. That requirement isn’t currently in effect, but is scheduled to be implemented January 1, 2012.
The measures are expected to pass the House. Though neither measure is likely to reduce unemployment in a significant way, these will be the first provision of President Obama’s jobs bill to become law—a fact Republicans are citing as evidence that they’re willing to compromise with Democrats to grow the economy.
The veterans incentive is great for addressing high unemployment among veterans, but doesn't actually create jobs. The other is essentially revenue, and jobs, neutral since it isn't in effect now. The Senate pays for the tax credits by delaying currently scheduled fee reductions on VA mortgage loans. That's a great improvement over the pay-for in the House version of the repeal bill, which would have cut Medicaid and SCHIP benefits. The House version of this bill didn't include the veterans hiring tax credit. Since the bill doesn't require any tax increases on any rich people, the House is likely to pass it.
The White House released this statement from President Obama following passage of the bill.
Today, Republicans and Democrats in the Senate did the right thing and passed tax credits that will encourage businesses to hire America’s veterans. Tomorrow, our nation will commemorate Veterans Day and honor the service and the sacrifice of all who have worn the uniform of the United States of America. No veteran who fought for our nation should have to fight for a job when they come home, and I urge the House to pass these tax credits as well so I can sign them into law. I also urge Congress to pass additional jobs proposals in the weeks ahead to help the millions of other Americans who are still looking for work.