Senator Files Amendment to Repeal 3 Percent Withholding Mandate

Senator Olympia Snowe (R-Maine) Tuesday filed an amendment to repeal the 3 percent withholding mandate during consideration of the Airport and Airway Trust Fund Reauthorization being considered by the Senate.  While Snowe did not ask for a vote on the amendment, she did make a statement to bring the issue to the attention of the committee and asked that the committee consider it soon. In response, Chairman Max Baucus (D-Mont.) agreed that the Committee should take a closer look at the issues raised by 3 percent withholding and hinted at a hearing in the near future.  Baucus also called for a Government Accountability Office (GAO) study on the impact of the law on business and government. He also urged Congress’ Joint Committee on Taxation to complete a review of tax compliance provisions in law and regulation that have been put in place since the law was enacted in 2006 to address the tax gap issues for which 3 percent withholding was intended. Currently, two pieces of legislation have been introduced to repeal 3 percent withholding in the Senate.  The first is a bill by Senator David Vitter (R-La.), S. 89.  The second was introduced by Senators Scott Brown (R-Mass.) and Snowe, S. 164.  The latter provides for a revenue offset of unobligated federal spending. A House bill is expected to be introduced shortly by Congressmen Wally Herger (R-Calif.) and Earl Blumenauer (D-Ore.). AGC urges all members to contact their Senators and Representatives using AGC’s Legislative Action Center here. For more information, contact Karen Lapsevic at (202) 547-4733 or lapsevick@agc.org.