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Blackstone Ramps Up Lobbying as Tax Bill Looms

It signs the single biggest lobbying contract in the first half of 2007.
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Private-equity firms and hedge funds are flooding Washington, D.C., with dollars this year in an attempt to dissuade lawmakers from raising taxes on a big portion of their profits, according to the Center for Responsive Politics, a nonpartisan organization that tracks money and influence in U.S. politics.

CRP reported Thursday that the largest contract for lobbying services in the first half of 2007 was a $3.7 million agreement between

Blackstone Group

(BX) - Get Report

and Ogilvy Government Relations.

It said private investment firms are "ramping up their lobbying" as lawmakers

weigh the merits of bills in Congress that would more than double taxes on "carried interest" gains of

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private-equity and hedge fund managers.

One bill in the Senate would raise the rate on publicly traded investment firms like Blackstone and

Fortress Investment Group

.

In the House of Representatives, Michigan Democrat Sandy Levin wrote a bill with New York Democrat Charlie Rangel and Massachusetts Democrat Barney Frank that would tax carried interest profits at the income tax rate of all partnerships. It's being debated in the Ways and Means Committee.

Both houses of Congress held hearings on the taxation issues last week. While Democratic presidential candidates have voiced support for legislation, it's unclear whether there's enough support in Congress to pass any of the bills.