[Congressional Record Volume 143, Number 79 (Monday, June 9, 1997)]
[Senate]
[Page S5423]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KYL (for himself and Mr. Gramm):
  S. 859. A bill to repeal the increase in tax on Social Security 
benefits; to the Committee on Finance.


               THE SENIOR CITIZENS INCOME TAX RELIEF ACT

  Mr. KYL. Mr. President, I am pleased to have my colleague, Senator 
Phil Gramm, join me as an original cosponsor of the Senior Citizens 
Income Tax Relief Act. This legislation would give seniors relief from 
the Clinton Social Security tax increase of 1993.
  The recently passed Federal budget deal provides target levels for 
new spending and for modest tax relief. As Congress begins to write the 
bills to implement this budget blueprint, attention turns to the 
details. One of them is whether there will be sufficient room for tax 
relief for senior citizens.
  Millions of America's senior citizens depend on Social Security as a 
critical part of their retirement income. Having paid into the program 
throughout their working lives, retirees count on the Government to 
meet its obligations under the Social Security contract. For many, the 
security provided by this supplemental pension plan is the difference 
between a happy and healthy retirement and one marked by uncertainty 
and apprehension, particularly for the vast majority of seniors on 
fixed incomes.
  As part of his massive 1993 tax hike, President Clinton imposed a tax 
increase on senior citizens, subjecting to taxation up to 85 percent of 
the Social Security received by seniors with annual incomes of over 
$34,000 and couples with over $44,000 in annual income.
  This represents a 70-percent increase in the marginal tax rate for 
these seniors. Factor in the Government's Social Security earnings 
limitation, and a senior's marginal tax rate can reach 88 percent--
twice the rate paid by millionaires.
  An analysis of Government-provided figures on the 1993 Social 
Security tax increase finds that, by next year, America's seniors will 
have paid an extra $25 billion because of this tax hike, including $380 
million from senior citizens in Arizona alone.
  Mr. President, I want to make an additional important point. Despite 
all the partisan demagoguery, the only attack on Social Security in 
recent years has come from the administration and the other party in 
the Omnibus Budget Reconciliation Act of 1993. Not one Republican 
supported this tax increase on Social Security benefits.
  At the Clinton administration's insistence, the amount of tax relief 
we will be able to provide will be severely limited. It will be 
difficult, then, to repeal the Social Security tax increase. This is 
why I offered an amendment to ensure that we are able to expand tax 
relief in the future, and why the first tax relief proposal I am 
introducing will repeal President Clinton's 1993 Social Security tax 
increase.
                                 ______