Courtesy of Paul Caron's TaxProf blog, I note that the White House is threatening to veto the one-year AMT patch being considered by Congress. Specifically:
"The Administration does not believe the appropriate way to protect 21 million additional taxpayers from 2007 AMT liability is to impose a tax increase on other taxpayers. Accordingly, if H.R. 3996 were presented to the President in its current form, the President’s senior advisors would recommend he veto the bill."
How exactly does the White House rationalize counting AMT revenues towards its multi-year deficit forecasts, under this view? They're counting net revenues that they insist must be lost, not replaced.
UPDATE: Stan Collender, in his "Budget Battles" analysis of the AMT squall, puts it a bit more crisply:
"On one hand, the White House says that paying for a one-year "patch" on the AMT is unnecessary, so an offsetting tax increase isn't needed. As he has done with everything else Congress is considering that he doesn't like, the president is threatening to veto any AMT fix that is revenue neutral.
"On the other hand, congressional Republicans have been insisting that the Democrats maintain their pledge to live up to pay-as-you-go budget rules by offsetting the AMT fix so that it has no impact on the budget.
"The Republican positions clearly are not defensible.... [given] the glaring, inherent conflict between saying that the AMT fix doesn't have to be paid for and demanding that PAYGO, which applies to taxes, be maintained."
Collender notes as well how utterly (and I would add characteristically) incompetent the Congressional Democrats have been in letting the Republicans paint them into this corner, and in failing to explain why the AMT fix isn't a tax cut but the offsets are somehow tax increases.
Could those guys win a poker hand if they had four aces and the other side had face-up junk? I am starting to think not.
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