Teamsters Commend House for Passing Tax and Benefits Bill

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International Brotherhood of Teamsters

May 28, 2010, 05:22 ET

Hoffa: Legislation Includes Important Changes to Pension Rules

WASHINGTON, May 28 /PRNewswire-USNewswire/ -- Teamsters General President Jim Hoffa praised the House of Representatives today for passing a bill that will give pension funds more time to improve their finances.

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Hoffa also applauded the House for approving tax changes that will remove incentives for companies to move jobs overseas and will raise the tax rate for private equity managers.

He said the bill will change some of the funding rules that are causing problems for retirement funds across the country.

"There's a clear connection between strengthening pension plans and saving jobs," Hoffa said. "Employers will be forced to lay off workers or, even worse, declare bankruptcy if they have to divert too much cash from their company's operations to pension funds.

The changes include extended amortization for funds and a smoothing period for losses so employers won't have to redirect funds to their pension plans to make up for losses.

Specifically, the bill allows funds to amortize, or replace, recent investment losses over 30 years. It also allows them to account for one or two years of recent investment losses by smoothing, or averaging, the losses out over 10 years.

Hoffa commended the House for adding limits to companies' ability to avoid paying taxes by using foreign tax credits. "It says to employers that they will no longer be rewarded for sending American jobs overseas," Hoffa said.

"I'm also pleased that the House voted to remove the special tax treatment for private equity managers by increasing the tax rate on carried interest. Private equity firms have a track record of choking economic growth by wrecking healthy companies," he said.

The bill also extends unemployment insurance to most recipients.

"For most working families, this country is still in a recession," Hoffa said. "Extending unemployment benefits not only help workers who've lost their jobs, but they help the economy as a whole because recipients spend them quickly in their local community."

The Senate is likely to amend the legislation next month.

Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women in the United States, Canada and Puerto Rico.

SOURCE International Brotherhood of Teamsters