ABC’s Z. Byron Wolf reports: Senators voted this afternoon to strip $246 million for Hollywood film producers from the mammoth, nearly $900 billion stimulus package they are debating this week, but the bill is not getting any smaller.
Moments after stripping the money for Hollywood, Senators voted to add in a $11 billion measure for people who buy new cars this year, which will be welcome news to car manufacturers if the proposal makes it into the stimulus package that ultimately becomes law.
The auto amendment, proposed by Sen. Barbara Mikulski, D-MD, allows for a tax deduction for sales and excise tax paid on new cars bought this year and interest paid on new car loans. It passed by voice vote after Senators voted 71-26 to waive pay as you go rules to include it. The cars have to be less than $49,500 and the buyer family has to make less than $250,000 – ($150,000 for individuals)
"The Mikulski amendment is timely, targeted and temporary and it’s focused on saving jobs and creating jobs in the automobile industry," said Mikulski at 14:50. "What does my amendment do? it means this. if you buy a passenger car, minivan or a light truck within this year, will you get a tax deduction for your sales or excise tax and the interest on your car loan. it means that a family could save approximately $1,500 on a $25 car purchase."
Opponents of the auto amendments expressed concern that it would compound the already substantial problem in America of consumer debt.
Senators also voted 52-45 to strip a $246 million tax item from the bill that would allow movie producers to write off more of their production costs. Current law allows movie studios to write off all their production costs up to $15 million for anything filmed in the U.S.. The so-called "Hollywood earmark" would have given producers the choice to write off 50 percent of all costs for movies this year.
"I love the movies that they produce, the vast majority of them," said Sen. Tom Coburn, who led the charge against movie producers. "Some I abhor. But I enjoy their entertainment. I enjoy the fact that they’re very profitable, very viable. They’ve been very useful this last year, they’ve had the best January in history they’ve ever had. And for us to put a quarter of a billion dollars into a earmarked tax for the movie industry at a time when Americans are struggling I think belies the honor and integrity of this institution."
Supporters of the amendment said that it gave the film industry the same bonus depreciation rights that other industries were given in tax measures last year.