U.S. News

Senate Banking Head to Examine Blackstone Bill

By Reuters

U.S. Sen. Christopher Dodd, chairman of the Senate Banking Committee, said on Tuesday he plans to look at the potential impact of legislation that would sharply raise taxes on private equity firms going public, such as Blackstone.

Under legislation introduced last week by U.S. Senators Max Baucus and Chuck Grassley, publicly traded partnerships would be taxed at the corporate rate of up to 35%, instead of the 15% rate their partners now pay.

Montana's Baucus and Iowa's Grassley, the Democratic chairman and senior Republican, respectively, of the Senate Finance Committee, expressed specific concerns about the planned $4 billion initial public offering of Blackstone set to be priced on Thursday.

Dodd, a Connecticut Democrat seeking to become his party's presidential nominee, said he is committed as banking committee head to protecting investors and promoting capital formation in U.S. markets.

"I intend to examine ... legislation introduced by Senators Baucus and Grassley in order to learn more about the potential impact it may have on U.S. capital markets and the broader U.S. economy," Dodd said in a statement through a spokesman.

The comment, suggesting the possibility of Banking Committee scrutiny of the Baucus-Grassley bill, comes before as other lawmakers were sizing up the bill.

When it was introduced, Illinois Democratic Sen. Barack Obama, another White House hopeful, said he might support it.

New York Democratic Rep. Charles Rangel, chairman of the House Ways and Means Committee, applauded the bill and said it should "put everyone on notice that Congress may act."