March 17, 2009

Dodd calls for retribution tax for AIG

U.S. Sen. Christopher Dodd , D-Conn., called for an individually targeted tax to strike back at American International Group Inc.'s bonus pay plan.

The company, 80 percent owned by the government and the recipient of billions of dollars in bailout funds, has said the $165 million it plans to hand out in bonus pay is mandated by contract. In retribution, we'd write a tax provision specifically targeted to that audience, Dodd said in a CQ Politics report Tuesday.

U.S. Rep. Gary Peters, D-Mich., said he was drafting a bill that would tax bonuses of mroe than $10,000 by 60 percent, specifically limiting the bill to companies in which the government owns 79 percent or more -- in other words, just AIG, CQ Politics said.

U.S. President Barack Obama has pledged to pursue legal action against AIG. On Monday 79 House of Representatives members urged him to honor that pledge.

In another tact, House Financial Services Committee Chairman Barney Frank, D-Mass., said the government should simply assert its right as majority shareholder to take such measures as replacing AIG executives.

AIG Chief Executive Officer Edward Liddy is scheduled to appear before a House subcommittee Wednesday.