Republicans Ready To Take Negotiated Tax Bill To Clinton President Has Vowed To Veto House Version Of Capital Gains And Child Tax Credit Provisions
House and Senate Republicans said Tuesday night that they had resolved nearly all the differences between their respective tax bills and that they would present a united front in trying to reach a deal with the Clinton administration.
The differences between the ways the House and Senate arrived at an $85 billion tax cut were substantial and had complicated negotiations between Republican leaders and the administration on a compromise that President Clinton would sign.
But in agreeing to take a single position in the talks with the White House, Republicans adopted some positions that were closer to the House bill, which Clinton had made clear was unacceptable, and away from the Senate bill, which administration officials had said provided a reasonable starting place for negotiating a compromise.
“We had a very, very good negotiation,” House Speaker Newt Gingrich told reporters after the meeting. “We’re very close to getting this done.”
Senate Budget Committee Chairman Pete Domenici, R-N.M., said the Republicans are ready today “to start discussing the issues with the White House - we have reached sufficient agreement among ourselves.”
Republican leaders did not disclose details of the deal they worked out on the House and Senate bills. But people involved in the talks said it retained a provision in the House bill that would allow investors to subtract the effects of inflation in calculating their capital gains. Clinton said such a provision would lead him to veto the bill because it would cost the government so much in revenue in coming decades that it could send budget deficits out of control again.
The Republicans also maintained their opposition to making more low-income working families eligible for a proposed tax credit of $500 per child. Clinton has pressed the Republicans on the issue, saying families making $20,000 to $25,000 a year who already benefit from the earned income tax credit deserve the child credit as much as families making more money who do not benefit from the earned income credit.
The unified Republican plan would adopt a position on the child credit between the House bill, which the administration considers unacceptable, and the Senate bill, which is closer to what the White House wanted.
But Republicans said they had adopted a position closer to the Senate version on credits for college tuition.
The Republicans, however, apparently left unresolved two major differences between the House and Senate bills: whether to increase taxes on cigarettes by 20 cents a pack, and how to structure an extension of a tax on airline tickets.
Republicans said they hoped to begin full-scale negotiations with the administration on the tax bill today and and to send it to Clinton by the time the August recess.
Republicans said they had decided against passing a tax bill even if there is no agreement with the White House and sending it to Clinton, knowing he would veto it.