[Congressional Record Volume 146, Number 5 (Monday, January 31, 2000)]
[House]
[Pages H71-H77]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
MARRIAGE TAX PENALTY
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 6, 1999, the gentleman from Illinois (Mr. Weller) is recognized
for 60 minutes as the designee of the majority leader.
Mr. WELLER. Mr. Speaker, this is a great opportunity this evening to
talk about an issue that many of us have raised in this Congress over
the last several years. That is an issue that really is a fundamental
issue of fairness, an issue of fairness that the American people have
been asking some pretty basic questions about over the last several
years.
I represent the south side of Chicago, the south suburbs in Cook and
Will Counties, as well as bedroom communities and farm communities in
Illinois. And I found, whether I was in the steel workers union hall in
Hegwish or a neighborhood in Chicago or at the local legion post in
Joliet or the local grain elevator in Tonica, people often ask a basic
question: Is it right, is it fair that under our Tax Code that the
average married working couple pays higher taxes just because they are
married? They say why do the folks in Washington allow a Tax Code to be
in place that tells us that if we choose to get married and work, we
are going to pay more in taxes?
Mr. Speaker, they are stunned when they learn that 28 million married
working couples pay an average $1,400 more in higher taxes just because
they are married.
Clearly, the marriage tax penalty suffered by working married people
is fundamentally wrong and something we should change. I am so pleased
that the leadership of this House, the Speaker of the House, the
gentleman from Illinois (Mr. Hastert), has made reduction and
elimination of the marriage tax penalty the first priority this year.
First out of the box and on a fast track as a tax-related initiative to
help middle-class families.
The marriage tax penalty has been in place for almost 30 years, and
no one has gone back to fix it. I am pleased this Republican Congress
has made a decision to bring fairness to the Tax Code by working to
eliminate the marriage tax penalty.
The marriage tax penalty is something that affects real people. I
have a photo here of a young couple from Joliet, Illinois, Shad and
Michelle Hallihan, two school teachers. They teach in the local public
schools in Joliet. Shad and Michelle suffer a marriage tax penalty of
almost a thousand dollars because they are married. They recently had a
child, a baby. And as Michelle Hallihan pointed out to me, she said
that $1,000 the marriage tax penalty that they suffer, that is 3,000
diapers that they can buy for their child that goes to Uncle Sam
instead of taking care of their child. It is real money.
Mr. Speaker, $1,400 in Joliet, Illinois, where Shad and Michelle live
is one year's tuition at Joliet Community College, and it is 3 months
of day care at a local day care center.
Let me explain how it came about. Our Tax Code has grown more
complicated and since the late 1960s, married working couples, moms and
dads, husbands and wives with two incomes have paid higher taxes just
because they are married. Of course, we have made this a priority, and
I would like to announce, of course, this Wednesday, the Committee on
Ways and Means is going to be marking up, committee action will occur
on legislation essentially to wipe out the marriage tax penalty for
almost 28 million married work couples. A real change that is going to
help people.
Mr. Speaker, this is how the marriage tax penalty works. Take a
machinist and a school teacher in the south suburbs of Chicago. They
have identical incomes. This machinist is making $31,500 as a single
person. Under our Tax Code, he is going to be taxed at 15 percent rate.
So he meets a school teacher, a gal with an identical income of
$31,500, and they choose to get married. And at the point they choose
to get married, they begin filing their taxes jointly.
When we file our taxes jointly, we combine our two incomes. In this
case, this machinist and school teacher who previously were taxed at 15
percent, because they chose to get married, their combined income
pushes their combined income to $63,000. They pay almost $1,400 more in
higher taxes because they are pushed, under our Tax Code, into the 28
percent tax bracket, the higher tax bracket. That is wrong, but today
that is the current situation for working married couples. So, really,
the incentives is in the wrong place. Marriage is one of the most basic
institutions in our society, and our Tax Code punishes marriage.
I would point out that had this machinist and school teacher chose to
live together outside of marriage, they would not suffer that extra
tax. Only when they choose to get married do they pay that higher tax.
And I think we all agree, that is wrong that we impose higher taxes on
married working people.
I am proud to say that the House Republican leadership, under the
leadership of Speaker Hastert, has made elimination of the marriage tax
penalty our first initiative in an effort to bring fairness to the Tax
Code and lower the tax burden on working families. This afternoon, the
gentleman from Texas (Mr. Archer) unveiled the legislation that will
provide tax relief for 28 million married working couples. It is
similar, almost identical in many ways, to the Marriage Tax Elimination
Act, H.R. 6, legislation that we introduced earlier this year which now
has 230 cosponsors, and overwhelming majority of Republicans; and I am
pleased that 12 Democrats have joined with us in an effort to make this
a bipartisan proposal.
Mr. Speaker, let me briefly share what the proposal that we will be
working on in the Committee on Ways and Means on Wednesday will do. It
is the goal of the House to act and approve and send to the Senate by
February 14, Valentine's Day, our effort to wipe out the marriage tax
penalty.
Think about it. What better Valentine's Day gift to give 28 million
married working people than elimination of the marriage tax penalty.
This legislation will essentially wipe out the marriage tax penalty for
almost everybody who suffers it. That will be a big change in our Tax
Code.
The legislation that we will be acting on and voting out of the House
in the next couple of weeks will help 28 million married working
couples. For those who do not itemize their taxes, they will see
immediately $230 dollars in marriage tax relief. For those who itemize
because they own a home, they will see $1,400 marriage tax relief under
this legislation.
I would point out that this makes a big difference. Under our plan,
we provide immediate marriage tax relief in 2001, next year, helping
millions of couples. And because we double the standard deduction for
those who do not itemize for joint filers to twice that of singles, 3
million married working couples will see their Tax Code simplified
because they will no longer need to itemize and fill out extra forms.
So we make filing for taxes easier.
And for those who do itemize, primarily homeowners, they will see
marriage tax relief as well. Twenty-eight million married work couples
will see up to $1,400 in marriage tax relief as a result of what the
Committee on Ways and Means will approve on Wednesday, and I expect
that an overwhelming majority of this House will see it approved before
Valentine's Day. What a great Valentine's Day gift that we can give 28
million married working couples, elimination of the marriage tax
penalty.
{time} 1915
I am joined by a number of my colleagues today who have been real
leaders in the effort to eliminate the marriage tax penalty.
[[Page H72]]
As I pointed out earlier, of the 435 Members of this House, we need
217 to pass a bill. So an overwhelming majority of the House have
joined in cosponsoring this bill. I am joined today by a number of
cosponsors of this legislation who have stepped forward and fought hard
to eliminate the marriage tax penalty.
Mr. Speaker, at this time I would like to yield to the gentlewoman
from Illinois (Mrs. Biggert). I appreciate her participating in today's
special order.
Mrs. BIGGERT. Mr. Speaker, I thank the gentleman very much for
yielding.
I would like to commend my colleague from Illinois (Mr. Weller) for
his dedication and commitment to the issue of the marriage tax penalty
that we are discussing here tonight.
Mr. Speaker, certainly the Federal Government taxes work, savings,
investment, entrepreneurship, risk taking, creativity, ingenuity, even
death. And you name it, Washington taxes it; and sometimes Washington
taxes it twice or three times. So it should come as no surprise that
the Federal Government taxes marriage.
That is right: 28 million working American couples pay higher taxes
simply because they are married. The Tax Code punishes working couples
by pushing them into a higher tax bracket, effectively taxing the
income of the second wage earner at a much higher rate than if he or
she were taxed only as an individual.
We are not talking about pennies, either. These families pay an
average of $1,400 more in taxes. This is money that could be used to
buy a family computer, improve their homes, or save for their
children's education.
For years, Republicans, led by my colleague from Illinois (Mr.
Weller), have led the fight to eliminate the marriage penalty. A
bipartisan majority of the House supports his legislation to do away
with the marriage penalty. We included it in our tax relief bill last
year.
Unfortunately, the President vetoed that bill and the significant
marriage penalty relief it provided. Now we hear from the President
that he wants to provide marriage penalty relief. I think that is
great, and I think we would welcome his support. So next month, when
the House passes the significant marriage penalty relief for the second
time in the 106th Congress, and I think it is a great idea to have that
on February 14, Valentine's Day, when we pass that in the House, the
President will have the opportunity to prove that his support is more
than the State of the Union talk.
There is no way around it. The Tax Code attacks one of society's most
basic institutions, marriage. So with the President and the Congress in
agreement on the need to provide marriage penalty relief, now is the
time to back up our words with action and bring tax equity for working
families.
So, again, I commend my colleague from the district right next to
mine for the work that he has done. I think it is important to note
that the bill that will be before the House Committee on Ways and Means
will provide even more benefits and actually improves the bill that has
been before us before in that it will provide relief in a shorter time
and more relief. This is an area that we have been working on for so
long.
Mr. WELLER. Mr. Speaker, reclaiming my time, I want to thank my
friend and colleague from Illinois (Mrs. Biggert) for her leadership
and efforts to eliminate the marriage tax penalty.
In suburban districts like my colleague from Illinois, we have many
homeowners; and one of the provisions that is so important in our
legislation that the committee will be acting on on Wednesday and the
House voting on around Valentine's Day is that we help those who
itemize who suffer the marriage tax penalty, as well.
If they own a home and they have to pay mortgage interest and they
pay property taxes and they combine those two, that usually causes them
to itemize their taxes. So I appreciate very much her leadership.
One other area I would like to point out that is so important about
the legislation that we will be acting on in the Committee on Ways and
Means and the House voting on within the next 2 weeks is that we help
28 million married working couples, and also we help those poor
families, working families, who participate in earned income tax credit
by working to offset a marriage tax credit that they suffer, as well.
So low-income families and low-income working families benefit from the
legislation that we are passing, as well.
Another thing I would like to point out is that people often say, if
the House moves quickly and the House is really showing leadership on
this, is the Senate going to act on it, too? I would like to point out,
too, that Chairman Roth of the Senate Finance Committee today praised
the gentleman from Texas (Chairman Archer) for the speedy start of the
House in this effort to eliminate the marriage tax penalty and that he
intends to move similar legislation in the coming months.
That is good news because we want to make elimination of the marriage
tax penalty our top priority first out of the box and on a fast track
to help 28 million married working couples.
Mr. Speaker, I see the gentleman from Minnesota (Mr. Gutknecht), my
friend, who has been a tremendous leader here on this effort to
eliminate the marriage tax penalty and who is one of the first ones to
say this is something that the House needs to do. I want to thank him
for that.
I am happy to yield to the gentleman from Minnesota (Mr. Gutknecht).
Mr. GUTKNECHT. Mr. Speaker, I thank my colleague from Illinois for
yielding.
The gentleman from Illinois (Mr. Weller) and I came together in the
Class of '94, and there were a number of things that we learned when we
first came here. First of all, we had this huge budget deficit that we
were wrestling with, $240-plus billion.
When we first came here, the Congressional Budget Office told us
after the President submitted his first budget that we would see
deficits of over $200 billion as far as the eye could see.
There were a number of problems here in Washington. One of the first
things we did is that we said we are going to make Washington live by
the same laws as everybody else and so that Congress is no longer
exempt when we pass new laws.
We balanced that budget. We reformed the welfare system. And today
over half of the people who were receiving welfare checks 5 years ago
are now receiving payroll checks. We made a tremendous contribution,
and I think we have moved the country in the right direction. This is
just the next installment of the Republican agenda.
I was surprised to learn how many people in America were paying extra
taxes just because they were married. That is just not bad tax policy;
that is not just bad family policy. At the end of the day there is
something almost fundamentally immoral for us as a Federal Government
to say they are going to pay extra taxes just because they have a
marriage license. That is bad policy, and we are finally in a position
where we can stop it.
I want to remind my colleagues and others who may be watching this
that if they would just like to check and see, if they have got a
married couple where they are both working, both earning approximately
the same income, and I think the example of my colleague is a good one,
I was in several schools in the last couple of weeks in my district
talking with teachers about education policy and other things, but it
was interesting how many times the issue of the marriage penalty came
up in my conversations with teachers.
The reason is that there are an awful lot of teachers who are married
to each other and they pay this marriage penalty. And so we have set up
on our Web site and if people would go to ``gil.house.gov'' there is a
calculator there and they can do a quick calculation. Now, it is not
exactly IRS approved, but it will give them a very close calculation of
what they are paying currently in terms of extra taxes just because
they are married.
So if any of my colleagues would like to check that, they can go to
my Web site, I think some other Members have it on their Web sites as
well, but ``gil.house.gov'' and they can actually find out how much of
a penalty in extra taxes they may be paying simply because they have a
wedding license. Bad tax policy. Bad family policy. And as far as I am
concerned, fundamentally immoral.
Mr. Speaker, I want to thank the gentleman from Illinois (Mr. Weller)
[[Page H73]]
for his leadership. And I want to remind people that we are going to
continue to do the hard work of balancing the budget, of saving Social
Security, of paying down debt, and providing real tax relief for
working families. They are not mutually exclusive.
One of the other issues that I have been pushing and I know my
colleague has as well is that we are going to take these things one
thing at a time. Last year we had a very good tax bill. It was $692
billion. But unfortunately I think in the eyes of a lot of Americans,
692 billion is sort of an amorphous thing. And so, this year we are
going to tackle these issues one at a time as the resources, as the
surpluses actually develop.
We are going to take the marriage penalty tax first. I would hope
then very shortly afterwards as we develop more surpluses as the
revenues come in that we would take a serious look at the death tax.
And if we cannot eliminate it, let us at least simplify it and make the
system fair. Because, again, I think it is fundamentally immoral to
have a 55 percent tax rate, a tax rate that quickly escalates to 55
percent. That is confiscatory and, as I say, it is fundamentally
immoral.
So there are some other things we need to tackle in this year, and I
think we are going to demonstrate early on that we are going to
continue to do the hard work of balancing budgets, of saving Social
Security, of actually paying down some of that national debt, and at
the same time providing significant and important tax relief for those
working families out there who work so hard every week. We know, at the
end of the day, those families know how to spend this money a whole lot
smarter than bureaucrats here in Washington.
So I just wanted to rise and speak in strong support for this bill
and do what we can to work through the process to get it through the
House, get it through the Senate, and get it to the President's desk.
Because I am convinced we are going to have overwhelming majorities on
both sides of the political aisle here in the House and as well as the
Senate; and I think that, at the end of the day, the President will
sign this bill and very soon couples like this one will not have to pay
extra taxes just because they are married.
Mr. WELLER. Mr. Speaker, reclaiming my time, I thank the gentleman
from Minnesota (Mr. Gutknecht) for his leadership and for his
participation tonight in explaining the marriage tax penalty, what it
is and why it is wrong and what we are going to do about it.
I look back, in listening to my colleague's comments, to 5 years ago
when he and I were elected as part of the Class of 1994; and if we
think about it back then, think of the issues that were facing us.
Congress and the President had just imposed the biggest tax increase in
the history of this country on the American people, putting the tax
burden at the highest level it had ever been in peacetime history. The
Federal Government was looking at $200 billion to $300 billion in
deficit spending for the foreseeable future. More children were living
in poverty than ever before. There was a rogue IRS running amuck
amongst families and small business.
We brought about some fundamental changes during the last 5 years. We
balanced the budget for the first time in 28 years. We cut taxes for
the middle class for the first time in 16 years. And in the State I
represent, in Illinois, 3 million Illinois children now benefit from
that $500-per-child tax credit that was part of our middle-class tax
relief.
Remember all those times we were told time and time again that it was
radical, it was crazy, how can you balance the budget and cut taxes at
the same time?
Mr. GUTKNECHT. Mr. Speaker, if the gentleman would continue to yield,
I think the comment was that, if you go ahead with these reckless tax
cuts, lowering capital gains tax rates, remember, we were going to
lower the top capital gains tax rate from 28 percent to 20 percent.
That represents a 30-percent cut. And some of our colleagues on the
left said, well, you are going to blow a hole in the budget. I wonder
how many times we heard that expression.
Well, the interesting thing is we lowered the capital gains tax rate,
and we have actually seen more revenue coming into the Federal
Government. As more people convert assets that are not producing the
way they want to into other assets, they recognize that gain, they pay
the taxes. When you increase economic activity, you increase revenue to
the Federal Government. When you allow people to keep more of their own
money, revenue to the Federal Government goes up because they spend
that money, and it gets recycled through the private economy.
Here again is one classic example. This marriage penalty is the next
big log that is going to fall. And this will be a tremendous victory. I
was surprised to learn, 28 million American couples paying a penalty of
an average of $1,400.
We have made tremendous progress. There is still a lot to be done,
but we are not going to give up with just this. This will be the next
step. As we go forward, I think more and more Americans will see that
this will benefit not only a lot of working families but it will
benefit the economy as well.
Mr. WELLER. Mr. Speaker, reclaiming my time, as the gentleman from
Minnesota (Mr. Gutknecht) pointed out, there has been fundamental
change over the last 5 years, balancing the budget, cutting taxes for
the middle class. We, of course, passed welfare reform into law, the
first real welfare reform in a generation. In my home State of
Illinois, we have seen a 50-percent, one-half of our welfare roles have
been cut in half as a result of welfare reform. We reformed the
Internal Revenue Service, shifting the burden of proof off the backs of
taxpayers onto the IRS. That is a fundamental change.
We also did something this past year that was very much in response
to what I hear from the folks back home in Illinois. We stopped the
raid on Social Security. For the first time in 30 years, we balanced
the budget without spending one dime of Social Security, setting aside
$137 billion of Social Security for Social Security and Medicare, a big
fundamental change.
I am also asked about what are people doing about paying down the
national debt. We have paid down $350 billion of the national debt. We
are going to adopt a budget later this year that is going to eliminate
the national debt over the next 13 to 15 to 20 years. That will be
another fundamental change.
{time} 1930
That is why I am happy to yield to the gentleman from Virginia (Mr.
Goodlatte) who has been another real strong leader in our efforts to
eliminate the marriage tax penalty and help 28 million married working
couples. When we think about that, 28 million married working couples,
that means 56 million working Americans suffer higher taxes just
because they are married. I am happy to yield to the gentleman from
Virginia.
Mr. GOODLATTE. I thank the gentleman for yielding. I especially want
to thank and congratulate him for his effort in this matter. I know
that he has introduced, along with the gentleman from Indiana (Mr.
McIntosh) and the gentlewoman from Missouri (Ms. Danner), a Democrat,
H.R. 6 to eliminate the marriage tax penalty. I am pleased to be a
cosponsor of that legislation along with the gentleman from Minnesota
and many others because it is long overdue.
As has already been noted, we attempted to do that in the tax package
that we passed last year that was unfortunately vetoed by the
President. This time we are going to go back, put it right on the line
and say that we are going to introduce a bill, produce a bill that
simply eliminates the marriage tax penalty.
For the last year and a half, I have discussed it at every single one
of the dozens of town meetings that I have conducted across my
congressional district. Every time I bring this up, I can just see
everybody in the audience nodding their heads in agreement. They
understand this issue. I use exactly the illustration that the
gentleman from Illinois referred to earlier and he has provided to
other Members. I take that to them. I say, you have a couple, each
earning $31,500 per year for a combined income of $63,000. If they are
married, they will pay nearly $1,300 a year more than the same two
people with the same two jobs living in the same household with the
same income. People understand that that is totally contrary to good
public policy. It discourages marriage, it discourages people
[[Page H74]]
from being forthright with their income and their taxes.
We need to change that. Fairness is fairness. The American public
understands this. Poll after poll has reflected what each one of us
knows from our meetings with our constituents as well.
There was a recent poll by Wirthlin Worldwide that showed that 85
percent of Americans believe that the marriage tax penalty is unfair,
and 80 percent of them favor the elimination of the marriage tax
penalty. Eighty-nine percent of married women and 89 percent of working
and married mothers are among those who strongly believe that the
marriage tax penalty is unfair. And more than two-thirds of all
Americans, according to a Harris Poll, believe that the budget surplus
should be used to eliminate or reduce the marriage tax penalty.
I think that this is something that the American people expect us to
do. It is a disappointment when we put forward an effort like that
along with other very reasonable tax cuts directed at improving our
economy, creating more jobs and helping hardworking American families
who right now face the highest level of taxation they have ever faced,
to veto something like that. I am hopeful that this time we will have
the President's help in getting real, meaningful tax cuts in place
here.
If we look at the average American family, not wealthy people but the
average American family, when we add up what they pay in Federal, State
and local taxes, it comes to about 40 percent of the average family's
income. That is more than the average family spends on food, clothing
and shelter combined. When we add on top of that a penalty for being
married and having both members of the household having to go out and
work in order to support their family, it is truly an outrage that this
condition in our tax code has been allowed to persist as long as it
has. I am pleased with the commitment of our leadership to move this
legislation forward. I know we will have bipartisan support for it. It
is my hope that we will pass this legislation as quickly as possible
and get this tax relief to working families as quickly as possible.
Mr. WELLER. I thank the gentleman from Virginia for his leadership
and efforts on working to eliminate the marriage tax penalty. When we
think about it, $1,400 in Washington, D.C. is a drop in the bucket.
There are always those, particularly on the far left side of things,
who think that we should keep this money in Washington. They think that
$1,400 really does not matter much back in Illinois or Minnesota or in
Virginia; and, of course, that is really nothing here when they spend
billions of dollars in the Congress. But let me just share with my
colleagues what $1,400 means in the south suburbs, in the south side of
Chicago:
$1,400 is 3 months of child care at a local day care center in
Joliet, Illinois. It is a year at Joliet Junior College, our local
community college, 1 year's college tuition. $1400, the average
marriage tax penalty, is 4 months of car payments for the average
family. It is school clothes for the kids. As Michelle Hallihan pointed
out, that $1,000 marriage tax penalty that Shad and Michelle Hallihan,
two public school teachers in Joliet, Illinois, that they have to pay
just because they are married, that $1,000 is 3,000 diapers for their
newborn child.
Of course it is a family vacation. It is a computer for the kids to
help them in their school. It is several months of health insurance
premiums. It is a down payment for many first-time homebuyers on a
home. It is also a majority of the contribution to an IRA. It is real
money for real people. For some in Washington, it is no big deal. But
for folks in Minnesota and Virginia and Illinois and all across this
country, 56 million married people, it is real money, $1,400, the
average marriage tax penalty.
Mr. GUTKNECHT. If the gentleman from Illinois will yield, it is
interesting, we have had several of my staffers over the last couple of
years who have gotten married. In fact, we had two people working on my
staff who married each other. We did the calculation for them. It was
$1,400, an extra $1,400 in taxes that they were going to have to pay
that they would not have had to pay if they would have simply lived
together.
We look at this wonderful picture of these two young people here and
we think principally about young people getting married. But I was at a
meeting with some seniors and one of them came up to me with kind of a
funny look on his face and he said, ``I hope you do something about
this marriage penalty.'' I said, ``Really? Why?'' He said, ``Well, I'm
facing kind of an ethical dilemma myself as to whether or not this
woman I'm now seeing and I should get married, because we realized with
our particular financial situations, we're going to pay a penalty of
over a thousand dollars if we get married. It really puts us in sort of
a moral dilemma because we know what the right thing to do is but the
government shouldn't encourage you to do the wrong thing.''
As we look at the reforms that we have passed in the last 5 years,
since the Republicans took control of this place, they really are about
reversing what I think is one of the unwritten rules of Washington,
and, that is, no good deed goes unpunished. That was the rule for many
years in Washington. If you worked, you got punished. If you saved, you
got punished. If you invested, you were punished. If you tried to
create jobs and create wealth, you were punished, whether it was the
EPA or the tax code or whatever.
There was sort of this unwritten rule. In fact, it even applied to
Medicare. Some of us know that live in more rural parts of the country
that our hospitals get lower reimbursements because they have lower
cost hospitals. No good deed goes unpunished. This is one more example
where we can strike a blow and say that unwritten rule of Washington
needs to end.
It is not just about young people. It is about people of all ages. It
is bad tax policy. We have a chance to eliminate it. I am delighted we
are going to take this tax issue one slice at a time, starting with the
marriage penalty. Let us put them on the President's desk and let him
explain why if he thinks he should not sign this bill. Because I think
the American people are way out in front of us on this.
Mr. GOODLATTE. If the gentleman will yield, I think the gentleman
from Minnesota is right on when he points out that this is not just for
newlyweds, it is for anybody who is married at any time in their life,
for senior citizens who may have lost their spouse and are considering
remarrying and they have got a whole host of questions to be answered
about does it make sense to remarry or not or should we just live
together, which I think is a real concern for a lot of senior citizens.
We should take this issue off of the table for them. They should feel
like if the thing that they need is to have a loved one sharing their
home with them, that they can feel free to be married and not pay a
$1,400 or more penalty.
The other point to make here is that while there is a diverse array
of people who are benefited by this, one thing, the overwhelming
majority of them have in common and that is that these are middle class
and lower middle-income people in our country who are benefitting from
this overwhelmingly. The vast majority of people are where the larger
wage earner of the two is between $20,000 a year and $75,000 a year.
So we are talking about people who are working hard and needing every
bit of the money that they earn in order to meet all of their
obligations that they have in raising children and paying rent and
putting food on the table and so on. This is something that really
reaches out to people across all across America. I think it is
overwhelmingly of benefit to, as I say, hardworking American families
who are pressed into that category of spending an average of 40 percent
of their income on taxes. They do not feel like they are getting 40
percent back of all that hard work in the form of benefits for those
taxes compared to what they get for food and clothing and shelter that
they spend less on than they spend on those taxes.
Mr. WELLER. The gentleman from Virginia made a good point. The
marriage tax penalty is an issue that is faced by average, middle class
Americans. If you pay the average marriage tax penalty, you make about
$62,000 a year in combined income, between two hardworking Americans,
husband and wife, joined together in marriage who under our tax code
they file, they file jointly when they are married, are now paying the
marriage tax penalty. It is very much a middle class issue. Of course,
a proposal that we are going to
[[Page H75]]
be acting on in the Committee on Ways and Means on Wednesday and the
House voting on by Valentine's Day, of course, will also help low-
income families as well.
As I pointed out, we are working to address the marriage tax penalty,
but for those who participate in the earned income credit, a program to
help particularly families with children make ends meet, those who work
hard, have low incomes and ensure that they have got enough to get by
to take care of the kids' and their families' needs. We are not only
working to help the middle class but we are also helping lower income
working families as well with this initiative this House is going to
vote on.
Mr. GUTKNECHT. If the gentleman will yield, we are probably going to
hear from some of our friends on the left that if we provide this tax
relief, it is going to mean that there is going to be less money to
spend on education and health care and some other important things. But
to paraphrase one of our colleagues over in the Senate, the other body,
he once observed that this is not a debate about how much is going to
be spent on children or education or health care, it is a debate about
who gets to do the spending.
I know the family and I know the Federal Government, and I will bet
on the family every single time, because that couple which represents
those other millions and millions of couples around the country, I have
every confidence that they know how to spend their money smarter than
Washington does on their behalf. They are going to spend that money on
children. They are going to spend that money on education. They are
going to spend that money on health care. They are going to spend that
money on making certain that their family's needs are met.
As our colleague from Virginia indicated earlier, right now in
America today, this is a shocking statistic, that the average family
spends more on taxes, we are talking about State, Federal and local but
in total taxes, that average family spends more for taxes than they do
for food, clothing and shelter combined. There is something wrong in
America today when the tax collector takes first interest on all the
money that families earn.
This is just one very small, well, not small, this is one major but
very important step that we can strike on behalf of American families
around the country. Again, I congratulate the gentleman from Illinois,
I congratulate the leadership in this Congress. I do believe that it is
going to pass overwhelmingly on a bipartisan vote and then go to the
Senate.
I think some people are going to throw out the thing, well, it is
going to blow a hole in the budget. That is not true. If we control
Federal spending, there is more than enough money to balance the
budget, make certain that every penny of Social Security taxes goes
only for Social Security, there is more than enough money to begin to
really pay down that debt, and there is more than enough money to make
certain that American families are treated fairly. That is really what
this is all about.
Mr. WELLER. The gentleman pointed out something that is so true. That
is, that this year as we work to balance the budget for the fourth year
in a row, we are going to be adopting a plan that once again sets aside
100 percent of Social Security for Social Security, walling off the
Social Security trust fund so it cannot be used for anything else,
stopping the raid on Social Security. Again which is one of the
Republican priorities.
We are also going to, of course, strengthen our schools; and we are
going to pay down the national debt. But as we work to address the
issue of fairness in the tax code, I find in the south side of Chicago
and in the south suburbs that I have the privilege of representing in
Illinois, people say, ``My tax burden is too high.'' They point out
that 40 percent of the average Illinois family's income goes to
government in Washington, in the State capital, the local courthouse,
of course in local, State and Federal taxes and that it is the highest
tax burden in peacetime history.
Only at the end of World War II has our tax burden on our Nation been
higher than it is today. They complain about that. They are unhappy
that this tax burden is so high. They are frustrated because they feel
they can better spend those dollars. The other point they always make
to me is they are frustrated about how complicated and unfair the tax
code is. They think it is wrong that under our tax code that 28 million
married working couples pay higher taxes just because they are married.
{time} 1945
That is wrong. Think about it, $1,400, one year's college tuition.
The gentleman from Minnesota also brought up another point. It is not
just young couples, like Shad and Michelle Hallihan, but it is older
Americans, retirees; and they have two pensions that they are
collecting, and with their two pensions they are paying a marriage tax
penalty.
If you think about it, those in their later years, health care costs
are higher for them at that time, they are concerned about prescription
drugs, and one of the priorities for this Republican Congress this year
is passing a prescription drug benefit under Medicare that takes care
of those 15 million seniors who do not have prescription drug coverage.
Well, by eliminating the marriage tax penalty for senior citizens who
suffer it, they will have more of their own money to keep to meet their
own needs, rather than going to Washington. It is just wrong.
We have all heard the story about the elderly couple that decided to
get divorced because they found they could save money. That is wrong,
that under our Tax Code, the incentives are to get divorced, rather
than to get married, or not to get married in the first place. We want
to strengthen families in our country, and that is why elimination of
the marriage tax penalty is so important.
I would be happy to yield to the gentleman from Minnesota.
Mr. GUTKNECHT. Just in closing, Congressman Weller, I wanted to again
thank you, because there are two issues that you have worked very hard
to help reinforce that I think are sort of the mortar between the
bricks that holds our whole culture and society together.
First of all, strong marriages, because we know that societies that
have strong families are societies that need less government, they need
less police protection, they need less in terms of criminal
apprehension, they need less in terms of other social safety nets, if
you will. So strong families are important, and this is one very
important step to reinforce those.
The other area you have worked so hard on, and that is home
ownership. The one thing we know is that societies that have strong
families and a high level of home ownership are strong societies.
So I want to congratulate the gentleman on both of those fronts. I
hope the Committee on Ways and Means will report out a strong bill in
the next several days that we can have on the floor and get at the
President's desk by Valentine's Day. I think that is a fantastic gift
to give those millions of American couples.
Again, I thank the gentleman for his leadership and look forward to
working as best we can to make certain that this one unfairness in the
Tax Code is eliminated this year.
Mr. WELLER. Again, reclaiming my time, I thank the gentleman from
Minnesota for his comments, and his leadership. The gentleman from
Minnesota (Mr. Gutknecht) has been a real leader, one of the original
leaders in our effort to eliminate the marriage tax penalty, one of the
items of unfinished business that we have decided under the leadership
this year of House Speaker Dennis Hastert to make first out of the box,
put on a fast track, to help families by addressing the need to make
our Tax Code more fair and more simple, and we will benefit 56 million
working Americans who will benefit by eliminating the marriage tax
penalty.
We have often asked over the last several years as House Republicans
have worked to eliminate the marriage tax penalty, is it right, is it
fair that under our Tax Code that 28 million married working couples
pay more in taxes just because they are married.
The average marriage tax penalty is $1,400 in higher taxes just
because they are married. In the south side of Chicago, the south
suburbs and rural communities that I represent in Illinois,
[[Page H76]]
$1,400 is one year's tuition at the local community college; it is
three months of daycare at the local daycare center; it is 3,000
diapers for a newborn baby if they suffer the marriage tax penalty.
I am so proud that this House has made it a priority once again. I
was disappointed, in fact it broke my heart last year when President
Clinton and Vice President Gore vetoed our efforts to eliminate the
marriage tax penalty.
We sent to the President legislation which would wipe out the
marriage tax penalty for a majority of those who suffer it.
Unfortunately, because it was part of a package with a number of other
initiatives, the President vetoed it. He said he wanted to spend the
money on other things. Unfortunately, it fell victim to his desire to
create new government programs.
We believe, and our hope is, this year the President will join with
us. He mentioned in the State of the Union the other night the need to
address the marriage tax penalty. We want to take him at his word. He
has now made a promise, and we want him to keep it. We are going to
eliminate the marriage tax penalty.
When you think about it, that $1,400 we are going to allow the
average married couple to keep, that is going to be a big help to the
folks back home. We believe that by sending the President stand-alone
clean marriage tax elimination legislation, legislation that only has
one item in it, which is our effort to eliminate the marriage tax
penalty, that we will help 28 million working married couples, because
it should receive overwhelming bipartisan support.
As I pointed out earlier, an overwhelming majority, almost 220
Republicans are cosponsoring the Marriage Tax Elimination Act, about a
dozen Democrats. Hopefully more Democrats will join with us, because I
believe our legislation that will move out of the Committee on Ways and
Means this Wednesday will pass with overwhelming bipartisan support,
and I believe that that signal that will be sent to the Senate will, of
course, help the Senate maintain the discipline to move a bill quickly
through the Senate to eliminate the marriage tax penalty; and, of
course, then we can send it to the President, helping 28 million
working married couples.
Frankly, what better gift to give 28 million married working couples
on Valentine's Day than passage of legislation out of this House, which
wipes out the marriage tax penalty for 28 million married working
couples.
Let me again explain what the marriage tax penalty is for all those
that are interested. And for my friends in the House I would like to
point out, you know, the marriage tax penalty is a middle-class issue.
It is a working family issue, because if you are a married couple and
you work, you pay taxes, and if you are married, you pay higher taxes
under our Tax Code.
In Joliet, Illinois, I will give you an example of a machinist and a
schoolteacher. A machinist who works at Caterpillar, they make big
heavy equipment, those big tractors and bulldozers in Joliet, and the
machinist that works there, he makes $31,500.
As a single person this machinist at Caterpillar, at the Joliet
Caterpillar plant, he pays at the 15 percent tax rate. He pays taxes at
the most basic rate for average Americans, which is 15 percent. It is
the lowest bracket in our Tax Code.
But if he meets a schoolteacher with an identical income, a tenured
schoolteacher with an identical income, $31,500, of course, she pays in
the 15 percent bracket if she stays single and is single, but if this
machinist and schoolteacher in Joliet, Illinois, decide to get married,
they have to file jointly, which means they have to combine their
incomes.
Under our Tax Code today, this machinist and schoolteacher in Joliet,
Illinois, they are pushed into the 28 percent tax bracket, and under
our Tax Code, they pay almost $1,400 more in higher taxes just because
they chose to get married.
Now, if they chose not to get married and made the choice of living
together, they would not pay that marriage tax penalty; or if they were
married and chose to get divorced, they would save money. Those
incentives are just in the wrong place.
Now, under the proposal that the Committee on Ways and Means is going
to act on on Wednesday, we are going to help this machinist in Joliet,
Illinois, and this public schoolteacher in Joliet, Illinois, because we
are going to pass legislation out of the Committee on Ways and Means
and out of this House by Valentine's Day which will essentially wipe
out the marriage tax penalty; and for couples, such as this machinist
and schoolteacher, they will no longer be punished for being married
with passage of our legislation that we are going to move out of the
House the next couple of weeks.
What we do is we double the standard deduction immediately so that
joint filers have a standard deduction twice that for single filers.
Now, if you itemize your taxes, and most people who itemize their taxes
are homeowners and you itemize because you combine your property taxes
with your mortgage interest, and if that totals more than the standard
deduction, you itemize your taxes.
But under our proposal that we are going to pass out of the House in
the next couple of weeks, we double the standard deduction for joint
filers to twice that of singles, so that wipes out the marriage tax
penalty for those who do not itemize. We do that immediately in the
year 2001, this coming year. Next year we double the standard deduction
for those who do not itemize. So they are helped quite a bit.
I would point out by doubling the standard deduction for joint filers
to twice those of singles, we also simplify the Tax Code, one of our
other goals, because 3 million married working couples will no longer
need to itemize their taxes because we double the standard deduction
for joint filers to twice that of singles. So we simplify the paperwork
they are required to file when they file taxes on April 15th. So it is
a two-fer. We wipe out the marriage tax penalty, and we save them time
on their taxes.
Now, for many homeowners, in fact, an awful lot of homeowners,
particularly in the suburbs of Chicago and rural areas that I
represent, they itemize their taxes, because when you add together your
property taxes, you add together your mortgage interest and some of the
other items you might be able to itemize, charity deductions, they are
more than the standard deduction, so you itemize your taxes. We help
them as well.
What we do in our proposal to help those who itemize their taxes in
eliminating the marriage tax penalty is we widen the 15 percent
bracket. Right now if you are single, you can make about $24,000 or
$25,000 a year and be in the 15 percent tax bracket; but if you are
married and you file jointly, you can only make about $44,000 a year.
That is wrong, because if you choose to get married, you pay higher
taxes because of that. So we double it under this legislation. We widen
that bracket so those in the 15 percent bracket that are joint filers
can earn twice as much in their combined income as single filers,
wiping out their marriage tax penalty as well. That is good news for
married working couples. We help those who itemize; we help those who
do not itemize.
One of the other points I would like to make as well, I am often
asked, if you are going to eliminate the marriage tax penalty, does
that mean you are going to raise taxes on single people in order to
offset the loss of revenue for the Federal Government?
Well, we have addressed that issue. Under the legislation that the
Committee on Ways and Means is going to act on on Wednesday and this
House is going to pass by Valentine's Day, we wipe out the marriage tax
penalty for almost 28 million married working couples, and we make the
Tax Code essentially neutral, so you pay no more in taxes if you are
married or single, so two people with identical incomes in identical
circumstances pay no more in taxes if they are single or married.
That is fairness, bringing fairness to the Tax Code, because it
responds to that fundamental question, and that is, is it right, is it
fair that under our Tax Code that you pay more in taxes just because
you are married.
I am so pleased and really pretty proud that the House leadership
under the leadership of House Speaker Dennis Hastert has made
elimination of the marriage tax penalty priority Number 1 when it comes
to addressing the need to fix the Tax Code to make it fairer and
simpler, and that we are going to give a Valentine's Day gift to
[[Page H77]]
28 million married working couples by passing out of this House by
Valentine's Day our legislation which will essentially wipe out the
marriage tax penalty for a majority of those who suffer it.
I often refer to this young couple that came and talked to me about
the need to eliminate the marriage tax penalty and what it meant to
them. Whenever we talk about the marriage tax penalty, I think of
couples such as Michelle and Shad Hallihan, two public school teachers
in Joliet, Illinois, who made the decision to get married; and they
made that decision knowing full well that under our Tax Code they were
going to pay more in taxes just because they are married.
Well, it is young people like Michelle and Shad, as well as older
folks who are retirees who suffer the marriage tax penalty, that we
want to bring fairness to the Tax Code by eliminating the marriage tax
penalty.
I really believe that this year we have an opportunity.
Unfortunately, the President and Vice President Gore vetoed last year
our efforts to eliminate the marriage tax penalty for a vast majority
of those who suffer it, and it fell victim to the President's desire to
spend more money on government programs. And while we wanted to
eliminate the marriage tax penalty, we made a commitment last year that
we were going to try again.
I am pleased that this House in the next 2 weeks is going to vote on
legislation which will wipe out the marriage tax penalty for a majority
of those that suffer it. That is good news. That is good news for 28
million married working couples. Fifty-six million Americans who are
married and work will benefit from this legislation, and they will see
anywhere from $230 to almost $1,400 in marriage tax relief as a result
of this legislation. That is good news.
My hope is this entire House will vote yes. Now, there are 12
Democrats that have joined along with us, out of the 231 cosponsors of
the Marriage Tax Elimination Act. The gentlewoman from Missouri (Ms.
Danner) has been a real leader. My friend, a Democratic Member from
Missouri, has been a real leader in the effort to eliminate the
marriage tax penalty, and I am so proud to have her as a partner, and
she has been able to bring about a dozen of her Democratic colleagues
with her.
My hope is and we want to extend an invitation to our Democratic
friends to join with us and make this a bipartisan effort.
The President said in his State of the Union speech the other night
that we should address the marriage tax penalty. We want to take the
President at his word, so that when we place on the President's desk a
stand-alone bill, clean marriage tax elimination legislation, that he
will sign it into law, because it is going to provide real relief and
address the need to bring fairness to the Tax Code when it comes to
marriage.
You know, you think about it, our Tax Code has the incentives in the
wrong place. We should be working to strengthen society's most basic
institution. We can do that by eliminating the marriage tax penalty.
My hope is over the next 2 weeks we will be able to garner
overwhelming bipartisan support to send with a strong message to the
Senate our desire to eliminate the marriage tax penalty. I appreciate
the comments of Chairman Roth of Delaware, who has been a real leader
in working to bring tax relief for middle-class families.
Again, as I pointed out earlier, Chairman Roth, chairman of the
Senate Finance Committee, praised the gentleman from Texas (Chairman
Archer) for the speedy start to open this issue. Of course, Mr. Archer
is chairman of the House Committee on Ways and Means, part of our
leadership here in the House. Chairman Roth indicated he intends to
move shortly over the next few months similar legislation to eliminate
the marriage tax penalty.
Let us keep this legislation on a fast track. There are 28 million
married working couples, 56 million hard-working married people that
are out there who need help. They need fairness in the Tax Code as it
affects married people. We want to help them.
My belief is we have a tremendous opportunity, a clean stand-alone
effort to eliminate the marriage tax penalty. It deserves overwhelming
bipartisan support. It deserves to be signed into law. It is all about
fairness.
Let us bring fairness to the Tax Code. Help couples such as Michelle
and Shad Hallihan, public school teachers in Joliet, as well as 28
million other working couples, by eliminating the marriage tax penalty.
{time} 2000
I thank the Speaker for the opportunity to address this House and our
efforts to eliminate the marriage tax penalty and bring fairness to the
Tax Code.
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