[Congressional Record Volume 145, Number 8 (Tuesday, January 19, 1999)]
[Senate]
[Pages S346-S347]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. GRAMS (for himself, Mr. Roth, Mr. Abraham, Mr. Ashcroft, 
        Mr. Lott, Mr. McCain, Mr. Coverdell, and Mrs. Hutchison):
  S. 3. A bill to amend the Internal Revenue Code of 1986 to reduce 
individual income tax rates by 10 percent; to the Committee on Finance.


                     Tax Cuts for All Americans Act

  Mr. GRAMS. Mr. President, I rise today to introduce S. 3, the Tax 
Cuts for All Americans Act, along with Senator Roth, Chairman of the 
Senate Finance Committee.
  First, I'd like to commend the Senate Majority Leader for including 
this important legislation as one of the Republicans' top 5 agenda 
items and Finance Committee Chairman Roth for making this a committee 
priority. This emphasizes the importance and commitment by Republicans 
to provide meaningful tax relief for working Americans.
  Mr. President, American families are taxed at the highest levels in 
our history, even higher than during World War II, with nearly 40 
percent of a typical family's budget going to pay taxes on the federal, 
state and local levels.
  Today, the Clinton Administration consumes over 20.5 percent of 
America's entire gross domestic product. That's the highest level since 
1945 when taxes were raised to pay for the war.
  The average American family today spends more on taxes than it does 
on food, clothing, and housing combined. If the ``hidden taxes'' that 
result from the high cost of government regulations are factored in, a 
family today gives up more than 50 percent of its annual income to the 
government.
  At a time when the combination of federal income and payroll taxes, 
state and local taxes, and hidden taxes consumes over half of a working 
family's budget, the taxpayers are in desperate need of relief.
  Americans today are working harder but taking home less. Over $1.8 
trillion of their income will be siphoned off to the federal government 
this year. It is more critical than ever to provide meaningful tax 
relief for working Americans.
  Freedom for families means giving families the freedom to spend more 
of their own dollars as they choose. This tax relief would give 
Americans more freedom and create more economic opportunities for them 
and their children.
  That's why I am introducing this legislation today. Tax relief should 
benefit all Americans, not just those who have been targeted in the 
past. My bill, S. 3, will do just that.
  My bill will cut the personal tax rate for each American by 10 
percent. It will increase incentives to work, save and invest. It will 
improve the standards of living for all Americans and permit the growth 
in our economy we expect to continue and it will encourage Americans to 
work harder and produce more.
  By enacting the 10 percent across-the-board tax cut, we can begin 
turning back the decades of abuse taxpayers have suffered at the hands 
of their own government, a government too often eager to spend the 
taxpayers' money to expand its reach over more of our economy and 
personal lives.
  It was John F. Kennedy who observed that ``an economy hampered with 
high tax rates will never produce enough revenue to balance the budget 
just as it will never produce enough output and enough jobs.''
  Twenty-seven years ago, President Reagan enacted a 25 percent across-
the-board tax cut and in 1986, President Reagan signed a landmark piece 
of legislation to reduce the marginal tax rate to a simple two-rate 
income tax system: 15 percent and 28 percent.
  What resulted was nothing short of an economic miracle. Our nation 
experienced the longest peacetime economic expansion in American 
history, the benefits of which we are still enjoying today. Ronald 
Reagan fought for tax cuts, not to bribe special interest groups to buy 
their votes--but because individuals have a right to spend their own 
money.
  President Reagan was right. When we enact the 10 percent across-the-
board tax cut, we will make our economy more dynamic, and our families 
more prosperous as we approach the 21st century.
  While I prefer a total overhaul of the tax system and will shortly 
introduce a bill to repeal the current system with a consumption tax, 
this is a much-needed first step we should all agree is our first 
priority for this Congress.
  Mr. ABRAHAM. Mr. President, I rise to join my colleagues Senators 
Grams and Roth in introducing S. 3, the Tax Cut for All Americans Act. 
This legislation will provide every American taxpayer with substantial 
tax relief by cutting all income tax rates 10 percent across the board, 
effective January first of this year.
  American working families need this tax cut, Mr. President. They are 
now taxed at a higher rate than at any time since World War II. Not 
even at the height of the Vietnam War have the American people seen 
such a large part of their pay taken away from them in the form of 
taxes.
  Since the current Administration came into office in 1993, federal 
taxes have gone up by over 35 percent, or over $600 billion. The 
nonpartisan Tax Foundation recently told us what these sky-high taxes 
mean to the typical American family. First, they mean that the typical 
family now pays more in total taxes than it spends on food, clothing 
and shelter combined--spending more than 38 percent on taxes and only 
28 percent on food, clothing and housing.
  Second, the typical American now works nearly three hours out of an 
eight hour day just to pay taxes. That American works from January 1 to 
May 10, the latest day ever, before he or she stops working for the 
government and starts working for him or herself.

[[Page S347]]

  Washington currently takes 21 percent of the national income in 
taxes. That's $6,810 for every man, woman and child in this country.
  Mr. President, that is simply too much. Our high taxes place an undue 
burden on working families. They stifle entrepreneurial activity. They 
promise to put an end to our current era of sustained economic growth.
  But hard times born of high taxes are not inevitable. We can lighten 
the tax burden on our working families. We can encourage 
entrepreneurial activity and economic growth. We can cut taxes and 
thereby ensure prosperity well into the next century.
  Mr. President, when President Clinton passed the largest tax hike in 
American history, he did so on the grounds that budget deficits 
demanded increased federal revenue. There was indeed increased federal 
revenue after that tax hike. But it was fueled by a surprisingly strong 
economy, born of technological innovation and low inflation, factors 
strong enough to offset the dampening effects of higher taxes. 
Moreover, the excuse of budget deficits is no longer tenable.
  We have entered an era of budget surplus. And it is our moral duty as 
well as our fiscal responsibility to lower taxes on those hard working 
Americans who pulled us out of the era of budget deficits.
  What is more, by taking a small portion of our projected surplus and 
giving it back to the American people, we will ensure prosperity, 
economic growth, and healthy receipts for years to come.
  Mr. President, this across the board tax cut will leave the current 
tax structure's progressivity intact. It also leaves current deductions 
and credits intact. It is not intended as a final solution to all of 
the problems in our tax system. This tax cut is intended as a well-
deserved down payment on the money Washington owes to the American 
people--the money earned by the American people that should stay with 
the American people, to save, invest and spend as they see fit.
  America's working families deserve a break. They also need it if they 
are to save and invest for their future and for the future of the 
American economy. It is time to give them that hard-earned tax break by 
cutting rates across the board by 10 percent. I urge my colleagues to 
support this important legislation in the name of fairness and economic 
responsibility.
                                 ______