Copyright 2000 / Los Angeles Times
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September 14, 2000, Thursday, Home Edition
SECTION: Part A; Part 1; Page 1; National Desk
LENGTH: 1134 words
HEADLINE:
HOUSE SUSTAINS VETO OF BILL ON MARRIAGE TAX;
CONGRESS: ACTION COMES
LESS THAN A WEEK AFTER THE LAWMAKERS FAILED TO REVIVE A MEASURE REPEALING ESTATE
TAX.
BYLINE: JANET HOOK, TIMES STAFF WRITER
DATELINE: WASHINGTON
BODY:
The House on Wednesday failed to
override President Clinton's veto of legislation to cut taxes for married
couples, sounding the death knell for Republican efforts to muscle broad-based
tax relief into law this year.
The 270-158 vote was 16 fewer than the
two-thirds majority needed to negate the veto of the so-called marriage penalty
bill. The action came less than a week after the House failed to override
Clinton's veto of a bill repealing the estate tax.
A handful of smaller
tax cuts remains before Congress and they stand a good chance of making it into
law. Among them is a popular bill to significantly raise--from $ 2,000 to $
5,000 a year--the contribution limit for individual retirement accounts and
increase the amount workers may put into 401(k) retirement savings plans.
But the marriage penalty and the estate tax bills were the biggest,
broadest tax cuts on this year's agenda--signature initiatives by the
Republican-controlled Congress. The final collapse of hopes that these measures
would become law has fueled a shift in GOP strategy. Heading into year-end
budget talks with Clinton, Republicans now say that they will push for
reductions in the national debt.
At a White House meeting Tuesday with
Clinton, Republicans proposed to earmark 90% of next year's anticipated federal
budget surplus--about $ 240 billion of almost $ 270 billion--to reducing the
debt. Democrats derided the idea as a one-year gimmick rather than a long-term
commitment by a party that now realizes its much ballyhooed tax-cutting agenda
is a flop among voters.
"What you are witnessing is a Saul-to-Paul,
road-to-Damascus, burning bush conversion," said House Minority Leader Richard
A. Gephardt (D-Mo.). "It all boils down to a public relations strategy to get
out of town and win the election."
Republicans said that the shift was
simply a pragmatic acknowledgment that Clinton will not approve big tax cuts.
The president is resisting their ideas, Republicans say, because he wants to use
more of the surplus for increased spending.
"We know what the writing on
the wall is," said House Speaker J. Dennis Hastert (R-Ill.). "If he's not going
to give tax relief . . . the next challenge on the table is paying down the
debt."
The tax cut debate still rages on the campaign trail--to mixed
effect. While cutting taxes in general has not topped the list of voter
concerns, individual tax cuts such as the one for married couples and the repeal
of the estate tax have been popular enough that scores of Democrats voted for
them.
Meanwhile, even as GOP presidential candidate George W. Bush has
promoted a $ 1.3-trillion, 10-year tax cut plan that includes deep reductions in
tax rates, few Republicans in competitive House and Senate races have made that
proposal central to their campaigns. Instead, they are running on the more
narrowly focused tax-cut agenda that the party sought to enact this year.
GOP leaders hope to use this session's tax cut votes to their advantage
against selected Democrats. For example, the National Republican Congressional
Committee plans to spotlight Rep. Joseph Hoeffel's opposition to the estate tax
and marriage penalty bills. The one-term Pennsylvania Democrat is considered
politically vulnerable in his swing district. "We're going to go after him with
everything we have on this issue," said Jim Wilkinson, spokesman for the GOP
group.
Eliminating the marriage penalty has been a key Republican goal.
The quirk in the tax code causes many couples, mostly in families with two
roughly equal incomes, to pay higher income taxes than if both partners had
filed as individuals. The GOP legislation would have given all couples a tax
break, including those who currently receive a marriage bonus: paying less in
taxes than if they filed as single taxpayers, generally when one partner is the
main earner.
The vetoed bill would have increased the standard deduction
for couples to make it exactly twice the break provided for single people. It
also would have expanded the current 15% tax bracket so more couples would
qualify for it. For low-income couples, the bill would have increased the earned
income tax credit by $ 2,000 a year.
The bill would have reduced federal
revenues by about $ 290 billion over 10 years, which Clinton argued was too
much. He and Democratic congressional leaders called for a more limited bill
that would target relief only to middle-class couples hurt by the marriage
penalty.
Conceding defeat even before the House vote, Republicans said
that the issue will help define the differences between the parties in the fall
election.
"Married couples will have to wait longer for relief," said
House Ways and Means Chairman Bill Archer (R-Texas). "It means that they will
have to vote for new leadership in the White House if they want justice and
fairness in the tax code."
In the final roll call on the bill, 49
Democrats joined 220 Republicans and one independent in voting to override
Clinton's veto. Supporting the president were 157 Democrats and one independent.
Among California House members, three Democrats joined their Republican
colleagues in voting to override: Lois Capps of Santa Barbara, Gary A. Condit of
Ceres and Ellen O. Tauscher of Pleasanton. All other Democrats voted to sustain
the veto except Anna G. Eshoo of Atherton, who did not vote.
What's Left?
Attention now turns to several smaller tax
cuts that remain alive. Among them:
* Retirement savings: The House has
approved legislation that would provide about $ 17 billion over five years in
tax relief by increasing tax-deductible contribution limits on individual
retirement accounts and 401(k) plans. A similar bill is awaiting action in the
Senate.
* Telephone tax: The House has approved a bill
to repeal the 3% excise tax paid by individuals and businesses on their phone
service. To expedite final passage, GOP leaders have linked the measure to a
must-pass appropriation bill that is awaiting final approval by the House and
Senate.
* Community renewal: A measure backed by President Clinton and
Republicans in Congress would provide $ 21 billion over 10 years in tax breaks
and credits to attract private business to the nation's poorest regions.
* Small-business relief: Republicans have proposed to Clinton a
compromise on legislation to increase the minimum wage that would link the pay
hike to a package of $ 76 billion in tax breaks for small businesses.
*
Social Security taxes: One bill likely to die is a measure passed by the House
that would slash a tax paid by about one- fifth of all Social Security
recipients. The bill would repeal a 1993 law that increased Social Security
taxes on seniors who have annual incomes exceeding $ 34,000 for individuals and
$ 44,000 for couples.
GRAPHIC: GRAPHIC: What's Left?,
Los Angeles Times
LANGUAGE: English
LOAD-DATE: September 14, 2000
