07-22-2000

TAXES: Tax Cut Train Keeps A-Rolling

Congressional Republicans this week prepared major tax reduction bills for
the short trip down Pennsylvania Avenue-and expected vetoes by President
Clinton. House and Senate leaders agreed on July 19 to compromise
legislation that would relieve the so-called marriage penalty. The measure
passed the House on  July 20 and was being prepared for final action on
the Senate floor. It would cost an estimated $90 billion over five years.
Negotiators omitted a provision in the Senate bill that would have
expanded the 28 percent income bracket; instead, only the 15 percent
bracket would be expanded. Meanwhile, the House on July 19 approved on a
401-25 vote a bill raising contribution limits for individual retirement
accounts and 401(k) funds. The bill, which would cost $52.2 billion over
10 years, now goes to the Senate. Clinton has said the measure doesn't do
enough for low-income people. Republican leaders decided to postpone
sending a bill to repeal the estate tax-or "death tax," in the
GOP parlance-to Clinton until September, in order to focus their attention
during the convention on relieving the effects of the marriage penalty.
House Majority Leader Dick Armey, R-Texas, said the goal is to give
Clinton multiple opportunities to sign or veto bills approved by a GOP
Congress-and for Republicans to reap political benefits from whatever
decision the President makes. But Democrats were already chirping that the
highest priorities for Republicans appeared to be giving tax cuts to the
rich. Still, Democrats are on the defensive about tax cut issues; their
leaders quickly stepped up denunciations of GOP-backed tax cuts as a
squandering of yet-to-be realized funds that may be needed for entitlement
reforms and education.


Stephen Norton/CongressDaily

National Journal