White House seems cool to bonus tax

WASHINGTON, March 23 (UPI) -- White House advisers displayed a cool reaction to the bonus pay tax that would target U.S. firms that reward employees with bailout-backed funds.

"I think the president would be concerned that this bill may have some problems in going too far … using the tax code to surgically punish a small group," Jared Bernstein, an economic adviser to Vice President Joseph Biden said, The Washington Post reported Monday.

"The president's been clear that we don't want to govern out of anger," an Obama adviser, Austan Goolsbee said. "He's going to look at what comes out of the House, what comes out of the Senate, see what ideas we have," Goolsbee said.

The House passed a measure last week that would recoup 90 percent of bonus pay from firms that use government assistance. The Senate will consider their version of a targeted tax bill this week.

Analysts have said the harsh anger that set the tone in Washington last week could undermine U.S. Treasury Secretary Timothy Geinther's plan to relieve banks of toxic assets.

Some banks have pulled back from asking for government support, wary the support could come with steep punitive measures, such as cuts in compensation.