- The Washington Times - Friday, May 9, 2003

Senate Republicans pushed their tax-cut bill through committee yesterday, though without much enthusiasm.The proposal passed 12-9, with all Republicans and Sen. Blanche Lincoln, Arkansas Democrat, voting for it. The bill reduces but does not phase out the tax individuals pay on corporate dividends. President Bush had wanted the dividend tax eliminated, since the same money is already taxed as corporate earnings, but Republicans could only get a majority of votes on the Finance Committee by cutting the proposal substantially.Instead, the Senate plan ends the first $500 of taxes individuals pay on dividends. Those who receive more than $500 would get a break on 10 percent of the difference through 2007, when it would rise to 20 percent.Most Republicans wanted to go much further in reducing the double taxation.”This bill is less — much less — than we should accept,” said Sen. Jim Bunning, Kentucky Republican, though he and other Republicans said they would support the bill in committee and then hope for something more to their liking later in the legislative process.”This is the best we can do today,” said Sen. Don Nickles, Oklahoma Republican. “I’m hopeful we can do much better on the floor, and better in conference.”Democrats also criticized the bill, which they say shortchanges lower-income individuals while rewarding those with the highest incomes.”It slights middle-class families in favor of the elite few,” said Senate Minority Leader Tom Daschle, South Dakota Democrat, who said the economy’s current state shows the president’s 2001 tax cut “simply hasn’t worked.”Almost no one seems enthusiastic about the bill.”I think you have probably accomplished a near-universal dislike of the product. That’s not easy to do,” Sen. John B. Breaux, Louisiana Democrat, told reporters.The Senate bill totals $350 billion in lost revenue to the Treasury, after factoring in about $80 billion in spending cuts and revenue increases. It also includes $20 billion in aid to states — a condition insisted upon by senators whom Republicans are counting on to support the final bill.One of those, Sen. Olympia J. Snowe, Maine Republican, was the only committee member who seemed to like the compromise.”I believe we’ve achieved a sound and fiscally responsible agreement that will satisfy the dual, critical goals of stimulating the economy, while at the same time exercising fiscal restraint to forestall unsustainable federal budget deficits in the future,” she said.Mrs. Snowe had refused to accept the president’s proposed total elimination or Senate Republican leaders’ alternative, which would have temporarily phased out the tax individuals pay on dividends over the next three years.The House is scheduled to vote on its $550 billion tax-cut bill today. It also doesn’t eliminate the tax individuals pay, but instead treats dividend income like capital gains, and it reduces the capital-gains tax rate to 5 percent for lower-income taxpayers and 15 percent for upper-income earners.Both House and Senate bills do follow the president’s recommendation in speeding up already-planned tax-rate cuts and advancing the child tax credit to $1,000 this year.President Bush yesterday vowed to keep pushing for more tax relief.”The question is, will the Congress respond in a bold enough way to help people who are looking for work find a job?” he told reporters yesterday. “I will continue reminding Congress that they have a responsibility to listen to the voices of those who are unemployed. I certainly have heard those voices. And you’ll see me, next week, continuing to take that message out to the country.”Meanwhile, the House reauthorized a job-retraining program yesterday after changing the law to allow religious groups participating in the program to discriminate in hiring based on religion.Republicans said the bill, which streamlines several sources of job-training money, is another part of their push to boost the economy through jobs and growth, but most Democrats opposed it because of the change in requirements for religious groups.


Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.

 

Click to Read More and View Comments

Click to Hide