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Amway's in on federal tax code



It was the second largest political contribution on record: $1 million to the Republican National Committee, from Amway President and Orlando Magic owner Rich DeVos on April 2. The largest? $1.5 million, in October, 1994. From Amway. Even as congressional hearings illuminate the corrupting effect of such "soft money" on Bill Clinton's presidential campaign, as pressure for campaign finance reform builds, the two parties raise record amounts. The party committees raised $34 million in the first six months of 1997, says Common Cause, the political watchdog group. During 1993, the last comparable time in the election cycle, they raised $13 million. The Republicans raised $23 million, more than twice the Democrats under fire in the Chinese money scandal. DeVos gave by request of the Republicans struggling to retire $5 million of debt following last year's Presidential loss. Some commentators decried what they called a $280 million tax break Amway got in the final budget bill. "I think it was `House Speaker Newt` Gingrich (R-GA) who slipped it in at the last minute," says Bonnie Williams, Common Cause Florida's regional director. "The year before they tried to slip it in to the minimum wage law, and it didn't fly. Then another year of contributions come in and low and behold...". Turns out the break is worth $19 million, at best, and not to Amway or DeVos but to about 2,500 folks who bought stock in two Amway overseas subsidiaries. The tax law in question is meant to apply to overseas mutual funds owned by U.S. investors, and, according to Amway lobbyist John Gartland, Amway only sought a change to allow the corporation to value its overseas distributors the same way it would value a factory. "They kept saying, 'No, you're a rifle shot,'" Gartland says of the tax-writing committee. A "rifle shot" is a change that affects only one person or company. "So we finally...searched the stock exchange for other companies that could benefit." They found four, just in time for Gingrich to insert the provision early this month.

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