"The specialized skills of the men and women who have served our nation in the Armed Forces can often prolong their job searches in the private sector, so I hope this bill will create a better environment for our veterans to get jobs in this difficult economy," Republican Sen. Lamar Alexander said.
The bill would give up to a $5,600 credit for hiring veterans who have been unemployed for more than six months, and a $2,400 credit for those who have been out of work for more than four weeks.
It would also increase the tax credit to $9,600 for businesses that hire disabled veterans who have been unemployed for more than six months, as well as enhance job training and counseling programs.
The measure was originally included in President Barack Obama’s jobs bill, but because it has yet to be considered by either chamber, the Senate unanimously approved of taking up that provision separately.
"But the biggest help Washington can give unemployed veterans and other job-seeking Americans is to get rid of the regulations and tax burdens that make it harder and more expensive for the private sector to create jobs," Alexander said.
The bill passed as part of a larger piece of legislation that included measures to tighten Medicaid eligibility requirements and repeal a 3 percent withholding tax placed on businesses that contract with the government.
Both the withholding tax repeal and Medicaid proposal passed the U.S. House as one combined bill in October. Senate leaders added the veterans tax credit measure as an amendment, bundling the three bills into one piece of legislation, which passed by a 95-0 vote.
"I am pleased the Senate took decisive action on my Medicaid legislation, as well as the 3 percent withholding repeal," said Republican Rep. Diane Black, who sponsored the bill. "Both bills are bipartisan, common sense solutions that I hope will be signed by the president as soon as possible."
Although Medicaid eligibility requirements had been expanded under Obama’s signature health care bill, Black introduced the measure in July to close what she described as an unwarranted "loophole" that needed to be fixed.
"When the Affordable Care Act was passed, few realized that because of a change in the income eligibility formula for Medicaid, a couple with close to $60,000 in income could qualify (in 2014) to receive Medicaid benefits," Black said. "Put another way, individuals whose incomes are up to 400 percent of the federal poverty level could qualify for federally subsidized health care – a totally unacceptable scenario."
While the veterans tax credit bill has received overwhelming support by members of both parties, some Democrats have disapproved of the Medicaid bill.
Several Democratic representatives argued it would negatively impact too many retirees and disabled individuals, citing a report by the Congressional Budget Office that even though the bill would reduce the deficit by $13 billion, between 500,000 and one million people would lose health insurance coverage.
Brandon Puttbrese, communications director for the Tennessee Democratic Party, said Black should consider other ways to trim the budget deficit.
"She should start by looking at the popular initiatives that a majority of Tennesseans support," Puttbrese said, "such as ending the tax breaks for big oil and the companies that outsource American jobs."
The savings from the Medicaid bill were used to offset the cost of passing the withholding tax. After the Senate revised some of the financial aspects of the larger piece of legislation, the CBO determined the veterans tax credit would not add to the deficit either.
"Instead, Black prefers to balance the budget on the backs of working Tennesseans by cutting a tiny health care benefit for middle class families who are struggling just to pay the bills," Puttbrese said. "Tennesseans will be served far better when (she) starts fighting as hard for the middle class as she does for big corporations and lobbyists."
Black reiterated previous statements she made on the House floor last month, dismissing the notion it unfairly targeted certain groups, and touted the withholding tax repeal as a jobs-producing measure.
"The 3 percent withholding repeal will be a great help to our economy by creating more certainty for small businesses, and my legislation to close this loophole in the health care law will ensure scarce Medicaid dollars go to those most in need," she said. "Medicaid was meant to assist the neediest Americans, and my legislation ensures the intent of Medicaid stays the same."
Because the Senate amended the bill passed by the House, it will now be considered in Conference Committee by both chambers. Once a final version of the bill is passed, it will be sent to Obama, who is expected to sign the legislation into law.