March 20, 2009 Friday
Updated
March 20, 2009
90% tax on bonuses

WASHINGTON - SWEPT up by a wave of populist economic anger, US lawmakers overwhelmingly voted on Thursday to slap a 90 per cent tax on bonuses at bailed-out firms like AIG.

The Democratic majority rallied a large swath of President Barack Obama's Republican critics as lawmakers voted 328-93 for the legislation and the furor raised the political heat on Treasury Secretary Timothy Geithner.

AIG, alive only thanks to billions in government rescue money, dished out US$165 million (S$253 million) in bonuses to top executives.

'We want our money back, and we want our money back now,' Democratic House Speaker Nancy Pelosi said during the often bitter debate.

The 90 per cent tax, written with AIG in mind, would apply to employees whose total annual pay exceeded US$250,000 at firms that received more than US$5 billion in government rescue funds.

A separate Senate measure with some support from both parties would impose 35 per cent excise taxes on both the firm and the recipient, though it was not clear how they would stack up on existing income taxes. -- AFP

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