The Michigan Daily- Wednesday, March 4, 1992- Page 7
Senate committee approves tax cut; rich will pay more
WASHINGTON (AP) -
Brushing aside veto threats, the
Senate Finance Committee yesterday
approved a $300-per-child, middle-
income tax cut that would be paid
for by raising taxes on the wealthy.
The bill includes a capital-gains
reduction, liberalized Individual
Retirement Accounts and investment
incentives President Bush has pro-
posed to stimulate the economy.
The permanent tax cut would
benefit approximately 20 million
families, while fewer than 1 million
Americans would have to pay more.
The vote was 11-9. Senate
consideration is expected next week.
"I hope the president will work
with us, not obstruct the process,"
Chairman Lloyd Bentsen (D-Texas)
said as the committee began work on
the bill, which he proposed. "But if
he wants to continue to protect the
wealthiest at the expense of average
Americans, that's his choice."
Bush has said repeatedly that he
will veto any bill that raises taxes,
even though his own budget calls for
tax increases this year. The Senate
bill would not result in a net tax in-
crease; it would raise some taxes by
a total of $57 billion over the next
five years and cut other taxes by the
"It doesn't create one job,"
insisted Senate Republican Leader
Bob Dole of Kansas. "This bill is
going to be vetoed and that veto will
be sustained. That's what the
Dole even accused Democrats of
tinkering with the proposed tax in-
crease in such a way that members
of Congress would not have to pay.
Bentsen replied that a check already
had been made and that more than
70 of the 100 senators would have (o
Republican on the committee.
Majority Leader George Mitchell
(D-Maine) noted that many
'Democrats appear intent on raising taxes while
doing nothing to improve competitiveness and
- Sen. Bob Packwood
pay more if the bill became law.
Outnumbered Republicans on the
committee washed their hands of the
bill and urged Democrats to quickly
do what they had to do - send the
measure to the Senate to pave the
way for a Bush veto.
"Democrats appear intent on
raising taxes while doing nothing to
improve competitiveness and
productivity," said Sen. Bob
Packwood of Oregon, the senior
Republicans had urged tax cuts in
the 1980s. "Now, when Democrats
propose to cut taxes, we are told it's
politics," he said.
The Finance Committee bill is
similar in many parts to the one that
Democrats pushed through the
House last week. One key difference
is in the principal individual tax cut.
The Senate bill would give a
credit of $300 per child to families
with incomes up to $50,000 a year;
the credit would drop gradually and
would not be available to those with
incomes over $70,000. By compari-
son, the House voted a credit of up
to $200 per wage earner ($400 per
couple) regardless of family size or
Senators included in their bill
some version of all seven economic-
stimulus provisions that Bush asked
Congress to pass by March 20. Some
are considerably different from what
Bush wants. Others, including relief
for the real estate industry and
incentives for business to buy
machinery this year, are quite
While Bush asked for a $5,000
credit for some home buyers, the
Senate plan would give that break
only to those who buy newly built
The Finance Committee also en-
dorsed a major expansion of
Individual Retirement Accounts,
making fully deductible IRAs avail-
able once again to almost all wage
earners, including those covered by
company pensions. In addition, a
worker could forgo an immediate
IRA deduction in favor of an ac-
count generating tax-free earnings.
The committee approved only
two amendments as it breezed
through the massive bill.
One, by Sen. Jay Rockefeller (D-
W.Va.) would impose a fee of up to
75 cents an hour on the wages of
many of the nation's coal miners.
The money would allow continua-
tion of health benefits for 120,000
retired miners, whose ages average
74 1/2 years, and their families. The
vote was 10-5.
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Friday, March 6.
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