Sat, Sep 25, 2004 - Page 7 News List

US Congress woos voters with tax cuts for families

NY TIMES NEWS SERVICE , WASHINGTON

The Republican-controlled Congress easily passed legislation on Thursday that would extend expiring provisions of some tax cuts for families as well as about 20 business tax cuts, at a cost of about $146 billion over 10 years.

Even though Democrats protested that the tax cuts would worsen the federal deficit and should been paid for with spending cuts or other tax increases, party leaders gave their members free rein to vote for the bill rather than incur the wrath of voters just a few weeks before Election Day.

Rushing the bill to a final vote on the floor after reaching agreement in a conference committee late Thursday night, House lawmakers approved it, 339-65.

In the Senate, the tax bill was approved, 92-3, with two Republicans, Olympia Snowe of Maine and Lincoln Chafee of Rhode Island, and one Democrat, Ernest Hollings of South Carolina, opposing it.

Republicans all but dared Dem-ocrats to vote against it.

The bill extends several individual tax cuts that were set to expire at the end of this year: a $1,000 child tax credit, which would have declined to $700 under current law; tax breaks for two-income married couples intended to reduce the so-called marriage penalty; and an expansion of the lowest 10-percent tax bracket to cover more people.

Democrats had made it clear they would vote to extend the tax cuts, but they tried during the conference committee to attach amendments that would have paid for them with either a surcharge on families with incomes above $1 million or by closing some corporate tax shelters.

Representative Steny Hoyer said the overall package would increase the federal deficit, which is expected to reach $420 billion this year and to remain high for the rest of the decade.

"Continuing to run up the national debt will insure that our children and grandchildren will face higher debt taxes for the rest of their lives," Hoyer said.

Democrats also released new estimates by the nonpartisan Congressional Budget Office, which showed that the federal deficit would remain above $300 billion a year for the next 10 years if Bush's tax cuts are made permanent and if military costs in Iraq continue at modest levels for the next several years.

Among those who reluctantly voted for the bill was Representative Charles Rangel, the ranking Democrat on the House Ways and Means Committee, who had proposed paying for the tax cuts by imposing a surtax on families with incomes above $1 million.

"It's timely," Rangel said. "It's on the eve of an election."

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