[Congressional Record Volume 143, Number 10 (Thursday, January 30, 1997)]
[Senate]
[Pages S877-S878]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. McCAIN:
  S. 242. A bill to require a 60-vote supermajority in the Senate to 
pass any bill increasing taxes; to the Committee on the Budget and the 
Committee on Governmental Affairs, jointly, pursuant to the order of 
August 4, 1977, with instructions that if one committee reports, the 
other committee have 30 days to report or be discharged.


              Tax Fairness and Accountability Act of 1996

 Mr. McCAIN. Mr. President I introduce legislation entitled the 
``Tax Fairness and Accountability Act of 1997.'' This legislation 
requires a supermajority vote in the Senate in order to raise taxes and 
eliminates the 60-vote Congressional Budget Act point of order against 
reducing taxes. A supermajority vote requirement is the strongest 
possible defense for this body's spending excesses. By requiring 60 
votes in the Senate to approve a tax increase rather than a simple 
majority, we will ensure that Congress does not balance the budget on 
the backs of taxpayers.
  Although our national debt currently stands at over $5.3 trillion, 
Congress' insatiable appetite for spending has not diminished. Our 
inability to reach a balanced budget for the past 28 years is not due 
to undertaxation but rather over spending. It is time that we place 
limits on the ability of government to casually dip into the pockets of 
an already overtaxed citizenry.
  According to the Tax Foundation, Americans spend more on their tax 
bill than food, shelter and clothing combined. This is simply 
outrageous. The American people cannot afford to be taxed anymore. 
Arizonans, for example, had to work until almost the beginning of May 
to pay their tax bill. Today nearly 40 percent of the American family's 
paycheck goes toward some kind of tax.
  There have been numerous studies that show when Congress increases 
taxes it increases spending by a greater amount. One study by the Joint 
Economic Committee, showed that for every dollar that was raised in 
taxes, Congress spent $1.16. Thus, the deficit reduction claimed by 
those who support raising taxes is lost. The 1990 budget debacle is the 
best example of Congress' chronic disease called tax and spend. Under 
the 1990 budget deal Congress was supposed to cut spending but of 
course it never did. The tough spending caps that were put in place 
under this agreement, were raised by Congress in order to satisfy their 
insatiable appetite for spending. We must do everything in our power to 
find a remedy for this disease. The supermajority vote requirement is 
the first dose of the medicine.
  This legislation is so important because politicians have forgotten 
whose money they are spending in Washington. Americans work very hard 
for the money they earn and send to Washington. Again and again studies 
show that people are working harder for less and are spending more time 
at work. In many families one or both parents must work two and three 
jobs just to make ends meet, leaving less and less time for family. 
Congress needs to take heed of these facts and recognize that families 
all across America are being forced to tighten their belts as the tax 
man continues to take an evergrowing portion of their money. Balancing 
the budget should require Congress to tighten their belt by reducing 
spending, not by asking Americans to pay more. I hope the Senate will 
act quickly on this important legislation.
      By Mr. McCAIN (for himself, Mr. Hollings, Mr. Ford, and Mr. 
        Gorton):
  S. 243. A bill to provide for a short term reinstatement of expired 
Airport and airway trust fund taxes, and for other purposes; to the 
Committee on Finance.


               REINSTATEMENT OF THE AVIATION EXCISE TAXES

  Mr. McCAIN. Mr. President, I rise today to introduce a bill, 
cosponsored by Senators Hollings and Ford, to reinstate the aviation 
excise taxes until September 29, 1997.
  On December 31, 1996, the aviation excise taxes expired. The aviation 
excise taxes include a 10-percent passenger ticket tax, a 6.25-percent 
freight waybill tax, a $6 per person international departure tax, and 
fuel taxes imposed upon general aviation aircraft. These taxes were the 
principal source of revenues for the airport and airway trust fund, 
which funds most of the budget of the Federal Aviation Administration 
[FAA] and all of the FAA capital programs.
  Recent estimates by the General Accounting Office [GAO] and the FAA 
indicate that, unless the excise taxes are reinstated, the trust fund 
will be out of available moneys by March or April of this year. The FAA 
will have to terminate spending on its capital programs--the safety and 
security enhancements that we have worked so hard to institute.
  It is unconscionable to allow the FAA to go without money that is 
absolutely essential to fund the safety and security programs of the 
national air transportation system.
  The current estimates of when the trust fund will be out of available 
money--which I just learned today--are much more dire than originally 
anticipated. There are several reasons for the unexpected worsening of 
the FAA's fiscal situation.
  The Treasury Department may have mistakenly credited the trust fund 
with $1.5 billion. Under normal circumstances, there is a gap in the 
time between the collection of taxes on airline tickets and the payment 
of those taxes into the Treasury by the airlines. In addition, those 
taxes are first paid into the general fund before being credited to the 
trust fund. When the aviation excise tax expired, so did the authority 
to transfer the revenues from the general fund to the trust fund.
  The result of this process is that billions in tax revenues from 1996 
are not paid to Treasury until 1997. Because those revenues cannot be 
transferred out of the general fund, the trust fund may have far less 
money than originally estimated. The trust fund could be out of 
available money by March, with curtailment of spending beginning even 
before that time because of the stringent provisions of the Anti-
Deficiency Act.
  On one particular point, I want to be very clear--the taxes should 
not be extended for more than a few months. We have a process in place 
to explore alternative long-term funding mechanisms to ensure the 
fiscal viability of the FAA and its important safety and security 
missions. Until the results of those studies are available and 
alternative mechanisms are in place, we must ensure that adequate 
funding is provided for these programs.
  These taxes were allowed to expire at the end of last December so 
that reinstatement of the taxes would count for new revenues which can 
be used to offset tax cuts or spending in other parts of the Federal 
budget. Playing budget games with these excise taxes is simply 
deplorable. The excise taxes paid by the users of the national air 
transportation system must be dedicated to that system.
  Mr. President, if the situation was dangerous before, it has now 
reached a very critical point. We must not delay any longer. Therefore, 
I am introducing this bill to take immediate action

[[Page S878]]

to begin the process of reinstating the aviation excise taxes until 
September 29, 1997. I will work closely with Senators Lott and Daschle 
to ensure early Senate action on this vitally important measure, so 
that the safety of our airline transportation system is not adversely 
affected.
  Mr. HOLLINGS. Mr. President, I rise today in support of extending the 
aviation ticket tax through the end of fiscal year 1997. This tax is 
very important to the day-to-day operation of our Nation's aviation 
system. Money to improve, maintain, and run our airports is 100 percent 
supported by fees paid by the users of the air transportation system. 
It is not paid for by the taxes we all pay on April 15. Every time they 
fly, people have been paying the user fees in the form of a ticket tax. 
That money has been going into the airport and airway trust fund, and 
the money is then disbursed through the appropriations process. We tell 
people to pay these fees, and we tell them we will then spend it on 
airports.
  However, there is one small problem. The ticket tax expired at the 
end of 1996. Due to budget games, the money that we thought would be in 
the trust fund is not there. Originally we were advised that the trust 
fund would be broke in July, but now it appears that it will be 
depleted as early as March. If this situation is not corrected, 
millions of dollars in airport modernization projects, aviation safety 
enhancements, and airport security efforts will have to be delayed or 
terminated. The obvious answer to this untenable situation is to 
reinstate the aviation ticket tax, and that is why I am cosponsoring 
Senator McCain's bill. I urge my fellow colleagues to quit playing 
budget games and start fulfilling Government's primary function--
preserving the safety of the American people.
  Mr. FORD. Mr. President, today I join my colleagues in cosponsoring a 
bill to reinstate the aviation ticket tax through September 29, 1997. 
This tax goes directly into the aviation trust fund. The tax has 
already expired and we cannot allow the trust fund to go broke. If that 
occurs, then it will be very difficult for us to continue to maintain 
the safety and security initiatives that are needed in order to secure 
and ensure the safety of our aviation system.
  I do not need to remind my colleagues of the importance of aviation 
safety. Over the past year, we have seen too many headlines which have 
underscored the need for a safe and secure aviation system. I urge my 
colleagues to act expeditiously on this very important matter.
  Mr. GORTON. Mr. President, on January 1, 1997, the aviation system in 
the United States received a serious blow when the aviation excise 
taxes lapsed. Together, these taxes--the 10-percent passenger ticket 
tax; the 6.25-percent cargo waybill tax; the $6.00 per person 
international departure tax; and certain general aviation fuel taxes--
account for more than 90 percent of the revenues in the airport and 
airway trust fund, which funds the Federal Aviation Administration and 
its programs.
  Without the collection of these revenues, the uncommitted balance of 
the airport and airway trust fund is quickly being depleted. In fact, 
it is running dry at a rate of $175 per second --more than $15 million 
every day. Yesterday, officials at the Department of the Treasury 
announced that if no action is taken to reimpose these taxes, the trust 
fund could be insolvent as early as March.
  For this reason, I am pleased to join my colleagues, Senators McCain, 
Hollings, and Ford, in sponsoring the Airport and Airway Trust Fund 
Taxes Short Term Reinstatement Act. This legislation will extend the 
existing system of aviation excise taxes through September 29, 1997, 
and give Internal Revenue Service authority to transfer previously 
collected aviation excise taxes into the airport and airway trust fund.
  The numerous aviation tragedies in 1996 have, I believe, lowered the 
public's confidence in the safety of the U.S. aviation system. While 
our system continues to be the safest aviation system in the world, 
Congress owes it to the American people to consider this legislation as 
quickly as possible to ensure aviation safety, security, and capital 
investment are not jeopardized in any manner.
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