Angry Congress Threatens Big Taxes on AIG Bonuses
By Newser Editors and Wire Services
Posted Mar 17, 2009 11:55 AM CDT
Senate Banking Committee Chairman Sen. Christopher Dodd, D-Conn., left, and ranking Republican Sen. Richard Shelby, R-Ala., listen during a hearing today.   (AP Photo)
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(Newser) – Outraged lawmakers threatened today to impose new taxes to recoup at least some of the $165 million in bonuses that insurance giant AIG awarded executives and traders after getting billions in federal bailout money. "What is the highest excise tax we can impose that will stand up in court?" Senate Finance Committee Chairman Max Baucus asked. "Let's find out what it is."

In the House, Reps. Steve Israel, D-NY, and Tim Ryan, D-Ohio, introduced a bill that would that would tax at 100% bonuses above $100,000 paid by companies that have received federal bailout money. "It boggles my mind how these executives can be so unaware of what the American people are going through," said Ryan. The IRS currently withholds 25% from bonuses less than $1 million, 35% for bonuses more than $1 million.