Last week, we covered the Bush Administration’s plan to sell 300,000 acres of national forests, specifically the role of Rep. Charles Taylor (R NC-11) in NC.

We also debunked the assertion that the money raised would go to help rural school districts as the administration claimed.

Now, the AP reports that two Democratic senators have found a way to pay for a similar program by closing a tax loophole they said allows some government contractors to avoid tax obligations.

The plan would allegedly raise $2.6 billion over the next 10 years for the “Secure Rural Schools and Community Self-Determination Act,” which is three times the amount of money we would get from selling our national forests.

…

“This is not a new tax. It just makes sure we get the payments” from federal contractors, said Baucus spokesman Barrett Kaiser.

…Under current law, the federal government does not withhold taxes owed by federal contractors. The Democratic plan would withhold 3 percent upfront of federal payments for goods and services delivered by private contractors.

The money would be applied to taxes owed by the contractor, which in most cases far exceed 3 percent of their total contract. If the tax obligation is less than 3 percent, the contractor would be reimbursed, Kaiser said.