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State Senate Democrats Call For 80 Percent Tax Surcharge On Bailout Bonuses
In the latest proposal to recoup the AIG bonus money for taxpayers, state Senate Democrats are calling for an 80 percent tax surcharge for anyone who receives a bonus from a company receiving federal bailout money.
Senate President Pro Tem Donald Williams, the highest-ranking senator, said the law would apply only to Connecticut residents, and the surcharge would be paid through their state income tax. Many of those receiving bonuses worked out of the AIG financial products division in Wilton in Fairfield County.
The $165 million in bonuses has sparked outrage nationwide, ranging from President Obama to legislators in Connecticut.
The 80 percent surcharge would be only on the bonuses, not on the full compensation of AIG employees. While saying that some people believe the surcharge should be 100 percent, Williams said that the 80 percent surcharge is fair because the taxpayers currently own 80 percent of AIG, a well-known insurance company that ran into major problems last September as the company's financial collapse became public.
"These are the folks who helped wreck the national economy,'' Williams said in an interview with The Courant. "It's an issue of fundamental justice for taxpayers. We want that money back. Why should this benefit Wall Street fat cats?
We're talking about a serious fleecing of taxpayers.''
Employees living in Westchester County, N.Y., for example, who commute to the AIG office in Wilton would not be affected, he said.
"If you're not paying Connecticut income tax, it wouldn't apply,'' Williams said. "We wouldn't have jurisdiction.''
Williams said he has not yet spoken to Republican legislators or Republican Gov. M. Jodi Rell about the proposal.