Congress last night passed legislation extending some of President Bush’s most-popular middle-class tax cuts — giving Mr. Bush a win heading into the final campaign stretch before Election Day.
“It is, I think, a significant and timely agreement that will prevent tax increases on millions of Americans and their families,” said Rep. Bill Thomas, California Republican and chairman of the House Ways and Means Committee.
Rep. Charles B. Rangel of New York, the top Democrat on Mr. Thomas’ committee, offered his sarcastic agreement.
“This is timely,” he said. “It’s on the eve of an election.”
The House overwhelmingly passed the measure by a vote of 339-65, with 125 Democrats including Mr. Rangel joining 213 Republicans and the House’s lone independent in support. All 65 votes against the bill were cast by Democrats.
The Senate promptly followed suit, passing the bill by a 92-3 vote.
The three senators who voted against the bill were Republicans Olympia J. Snowe of Maine and Lincoln Chafee of Rhode Island, and Ernest F. Hollings, South Carolina Democrat. All five nonvoting senators were Democrats.
The bill totals $146 billion in tax cuts and was crafted by Mr. Thomas and Republican leaders in the House and Senate, led by Senate Finance Committee Chairman Sen. Charles E. Grassley, Iowa Republican.
“It’s about providing tax relief to hard-working families,” Mr. Grassley said of the bill, while adding strong praise for Mr. Bush.
“The president made middle-income tax relief a priority,” he said. “We wouldn’t be here today without the leadership of our president.”
Mr. Bush praised Congress for passing the bill, saying the tax cuts will help families and the economy. After the vote, he also pushed for the day when his tax cuts will be made permanent, not just extended.
“This legislation will give families and small businesses added certainty and keep us on the path to greater prosperity, and it brings us one step closer to making the tax relief permanent,” Mr. Bush said.
With the election just around the corner, the pressure was on members of both chambers to support the tax relief.
Senate Minority Leader Tom Daschle, a South Dakota Democrat in a close re-election race, criticized the bill because its $146 billion value is not offset in any way, but in the end, he supported it.
“This bill is far from where it ought to be,” he said, concluding later that it will help middle-class families so, “in spite of its flaws, it deserves our support.”
“No one wants to vote against tax cuts — especially 40 days before an election,” a Senate Republican aide said.
At its heart, the package would extend three popular middle-class tax breaks, affecting 94 million Americans:
It would keep the per-child tax credit at $1,000, instead of letting it drop to $700, for the next five years.
It would continue the expanded 10 percent tax bracket for six years, through 2010.
It would extend “marriage-penalty” relief for four years.
The bill effectively extends all three breaks through 2010. The House Ways and Means Committee estimated that without these changes, families would face $109 billion in tax increases in the next 10 years.
“If you vote against this bill you are voting to increase taxes on the middle class in this country,” Rep. Jim McCrery, Louisiana Republican, warned before the vote.
Many Democrats and a few Republicans such as Sen. John McCain of Arizona made the case that the tax cuts should be extended, but only if the government offsets the cost of doing so.
“We cannot continue to disregard fiscal reality,” said House Minority Whip Steny H. Hoyer, Maryland Democrat. “Let’s extend these tax cuts. But let’s make sure that such tax cuts are paid for.”
Earlier this week however, Mr. Hoyer said although many Democrats want the breaks paid for in order to be fiscally responsible, this is an election year and he knows that a ‘no’ vote could be used against some Democrats in tough races.
As a result, Mr. Hoyer didn’t pressure Democrats to vote one way or the other on the bill.
Rep. Gene Taylor, Mississippi Democrat, told Republicans that their bill will “get you a few more campaign contributions at the expense of trillions of dollars in debt.”
“Our children will be paying for it for decades to come. … It’s got to stop somewhere,” Mr. Rangel said, urging Republicans to return to the balanced budget mentality they “used to believe in.”
Democratic presidential nominee Sen. John Kerry yesterday issued a statement straddling the issue, saying he supports the tax package because it provides middle-class relief, but sharply criticizing Mr. Bush because the bill also includes $13 billion in business-related tax breaks.
“I would make the middle-class tax cuts permanent, roll back the Bush tax cuts for the wealthiest families, close corporate tax shelters and invest in health care and education, and I would put in place tough rules to cut the deficit in half in four years,” Mr. Kerry said.
Neither Mr. Kerry nor his running mate Sen. John Edwards of North Carolina voted.
In addition to its three main provisions, the bill also would provide a one-year freeze on the number of middle-class taxpayers who have to pay the alternative minimum tax, and it would provide a few extra tax breaks to families who have a military parent fighting in a combat zone.
The package also contains $13 billion for one-year extensions of roughly 20 business-related tax provisions, including a tax credit for donating computers, a tax break for research and development and a $250 tax deduction for teacher classroom expenses. These are routinely extended every year.