Begich Votes to Support Students Seeking Affordable Education
U.S. Sen. Mark Begich today released the following statement after the Senate failed to move forward on the Stop the Student Loan Interest Rate Hike Act of 2012. The bill, which Begich supports, would have prevented interest rates from doubling for over seven million college students in the coming year.
Without Congressional action by July 1, the interest rate on new subsidized Federal Direct Stafford Loans for undergraduate students is set to double, from 3.4 percent to 6.8 percent, costing students an additional $1,000 on average over the life of their loans.
“As the economy continues to recover, now is not the time to burden students who rely on these loans to finance their education with an additional $1,000 in payments.
“I am disappointed we did not move forward on this important legislation, but I am optimistic we can still come up with a solution to help our young people before the July 1 deadline because it is the right thing to do. As the former chair of the Alaska Student Loan Corporation, I know affordable education makes a world of difference for students and families.
“As a small business owner, I want Alaskans to know that the claim this bill raises taxes on small businesses is a red herring, designed to confuse the public. This is about closing loopholes that currently allow some lobbyists, consultants and lawyers to skirt the law and avoid paying Social Security and Medicare taxes—which every other hard-working small business owner pays.”
The proposed bill rejected today is paid for by closing a tax loophole where S-Corporations don’t pay their fair share of Social Security and Medicare taxes. The bill would limit the new tax rules to individuals making at least $200,000 annually and own a business employing three or fewer people. Lawyers, lobbyists and consultants running their own businesses often form S-Corporations.