[Congressional Record Volume 143, Number 91 (Wednesday, June 25, 1997)]
[House]
[Pages H4613-H4614]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                  BUDGET RECONCILIATION TAX PROPOSALS

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentlewoman from North Carolina [Mrs. Clayton] is recognized for 5 
minutes.
  Mrs. CLAYTON. Mr. Speaker, the tax bill that we are here discussing 
and in particular the tax bill under the reconciliation package looks 
good on its face. Federal taxes are cut by a total of $133 billion over 
5 years. I believe the American people deserve and want a tax cut. But 
the devil is in the details of the tax bill. The bill has a phased-in 
$500 per child tax credit. This is a very important and most needed 
credit. Most Americans would certainly want that and embrace that. But 
the bill does not allow the credit before an earned income tax 
calculation. What does that mean? It means that low-income, struggling 
working people would therefore not get the same benefit that most 
Americans would get because they would be denied to have that 
opportunity as those who make more. Some 28 million children would be 
denied this tax credit because they do not earn enough money to get a 
tax break.
  Mr. Speaker, I believe the American people would be quite surprised 
to know, if some have their way, that the days of tax relief only for 
those who do not need tax relief are not over.

  The bill provides for estate tax relief. Again, this is a very 
welcome initiative that farmers and small businesspersons in my State 
have been seeking for a long time. But here again the bill phases that 
relief in, $20,000 a year over 15 years, while immediate and more 
relief to working families is needed. They need a faster phase-in. That 
kind of relief really amounts to no relief for low and moderate income 
working families. They need help now. For generations, these families 
have struggled to maintain their family farms or their family-owned 
business, only to face the loss of them when the head of the family 
passes, and they are unable to pay the estate taxes because their 
liquid assets are limited.
  And with regard to HOPE scholarships, a similar pattern emerges. 
Under the bill, working families would get $600 in relief, not the 
$1,500 that was

[[Page H4614]]

just spoken about. That amount of money does not go far enough to help 
those families struggling to send their children to college.
  The Democratic substitute, however, offers a better plan for lower 
and middle income families. In HOPE credits, they get $1,100 in tax 
relief. Estate tax relief is more in keeping with the realities of 
family-owned businesses. It is phased in at a faster rate and not over 
a 15-year period. And working families could still take advantage of 
the $500 tax credit. You do not deny poor working families that which 
you allow all other families to have.
  In addition, the Democratic substitute sets a cap on capital gains. 
Most people want capital gains. But again a reasonable and a prudent 
approach given our budget goal is what is needed. And it does not index 
capital gains to inflation.
  It is clear, Mr. Speaker, under close inspection, that the Democratic 
substitute is far more favorable to low and middle-income working 
families than the tax bill that will soon be before us that we will 
vote on tomorrow.
  Mr. Speaker, working families in America indeed need tax relief. They 
want it and they should have it. But they need it now and they need a 
fair one. I submit that the Democratic substitute provides that 
necessary relief. The tax bill does not.

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