[Congressional Record Volume 148, Number 44 (Thursday, April 18, 2002)]
[House]
[Pages H1429-H1452]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
FAIRNESS FOR FOSTER CARE FAMILIES ACT OF 2001
Mr. THOMAS. Mr. Speaker, pursuant to House Resolution 390, I call up
from the Speaker's table the bill (H.R. 586) to amend the Internal
Revenue Code of 1986 to provide that the exclusion from gross income
for foster care payments shall also apply to payments by qualified
placement agencies, and for other purposes, with a Senate amendment
thereto, and ask for its immediate consideration in the House.
The Clerk read the title of the bill.
The text of the Senate amendment is as follows:
Senate amendment:
Page 3, after line 19, insert:
SEC. 3. ACCELERATION OF EFFECTIVE DATE FOR EXPANSION OF
ADOPTION TAX CREDIT AND ADOPTION ASSISTANCE
PROGRAMS.
Subsection (g) of section 202 of the Economic Growth and
Tax Relief Reconciliation Act of 2001 is amended to read as
follows:
``(g) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2001.''.
Motion Offered by Mr. Thomas
Mr. THOMAS. Mr. Speaker, I offer a motion.
The SPEAKER pro tempore. The Clerk will designate the motion.
The text of the motion is as follows:
Mr. Thomas moves that the House concur in the Senate
amendment with an amendment, as follows:
In lieu of the matter proposed to be inserted by the
Senate, strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE; ETC.
(a) Short Title.--This Act may be cited as the ``Tax Relief
Guarantee Act of 2002''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in this Act an amendment or repeal is
expressed in terms of an amendment to, or repeal of, a
section or other provision, the reference shall be considered
to be made to a section or other provision of the Internal
Revenue Code of 1986.
(c) Table of Contents.--
Sec. 1. Short title; etc.
TITLE I--TAX REDUCTIONS MADE PERMANENT
Sec. 101. Tax reductions made permanent.
Sec. 102. Protection of social security and medicare.
TITLE II--TAXPAYER PROTECTION AND IRS ACCOUNTABILITY
Sec. 201. Short title.
Subtitle A--Penalties and Interest
Sec. 211. Failure to pay estimated tax penalty converted to interest
charge on accumulated unpaid balance.
Sec. 212. Exclusion from gross income for interest on overpayments of
income tax by individuals.
[[Page H1430]]
Sec. 213. Abatement of interest.
Sec. 214. Deposits made to suspend running of interest on potential
underpayments.
Sec. 215. Expansion of interest netting for individuals.
Sec. 216. Waiver of certain penalties for first-time unintentional
minor errors.
Sec. 217. Frivolous tax submissions.
Sec. 218. Clarification of application of Federal tax deposit penalty.
Subtitle B--Fairness of Collection Procedures
Sec. 221. Partial payment of tax liability in installment agreements.
Sec. 222. Extension of time for return of property.
Sec. 223. Individuals held harmless on wrongful levy, etc. on
individual retirement plan.
Sec. 224. Seven-day threshold on tolling of statute of limitations
during tax review.
Sec. 225. Study of liens and levies.
Subtitle C--Efficiency of Tax Administration
Sec. 231. Revisions relating to termination of employment of Internal
Revenue Service employees for misconduct.
Sec. 232. Confirmation of authority of Tax Court to apply doctrine of
equitable recoupment.
Sec. 233. Jurisdiction of Tax Court over collection due process cases.
Sec. 234. Office of Chief Counsel review of offers in compromise.
Sec. 235. 15-day delay in due date for electronically filed individual
income tax returns.
Subtitle D--Confidentiality and Disclosure
Sec. 241. Collection activities with respect to joint return
disclosable to either spouse based on oral request.
Sec. 242. Taxpayer representatives not subject to examination on sole
basis of representation of taxpayers.
Sec. 243. Disclosure in judicial or administrative tax proceedings of
return and return information of persons who are not
party to such proceedings.
Sec. 244. Prohibition of disclosure of taxpayer identification
information with respect to disclosure of accepted
offers-in-compromise.
Sec. 245. Compliance by contractors with confidentiality safeguards.
Sec. 246. Higher standards for requests for and consents to disclosure.
Sec. 247. Notice to taxpayer concerning administrative determination of
browsing; annual report.
Sec. 248. Expanded disclosure in emergency circumstances.
Sec. 249. Disclosure of taxpayer identity for tax refund purposes.
Subtitle E--Miscellaneous
Sec. 251. Clarification of definition of church tax inquiry.
Sec. 252. Expansion of declaratory judgment remedy to tax-exempt
organizations.
Sec. 253. Employee misconduct report to include summary of complaints
by category.
Sec. 254. Annual report on awards of costs and certain fees in
administrative and court proceedings.
Sec. 255. Annual report on abatement of penalties.
Sec. 256. Better means of communicating with taxpayers.
Sec. 257. Explanation of statute of limitations and consequences of
failure to file.
Sec. 258. Amendment to Treasury auction reforms.
Sec. 259. Enrolled agents.
Sec. 260. Financial management service fees.
Sec. 261. Capital gain treatment under section 631(b) to apply to
outright sales by land owner.
Sec. 262. Acceleration of effective date for expansion of adoption tax
credit and adoption assistance programs.
Subtitle F--Low-Income Taxpayer Clinics
Sec. 271. Low-income taxpayer clinics.
TITLE I--TAX REDUCTIONS MADE PERMANENT
SEC. 101. TAX REDUCTIONS MADE PERMANENT.
Title IX of the Economic Growth and Tax Relief
Reconciliation Act of 2001 is hereby repealed.
SEC. 102. PROTECTION OF SOCIAL SECURITY AND MEDICARE.
The amounts transferred to any trust fund under the Social
Security Act shall be determined as if the Economic Growth
and Tax Relief Reconciliation Act of 2001 had not been
enacted.
TITLE II--TAXPAYER PROTECTION AND IRS ACCOUNTABILITY
SEC. 201. SHORT TITLE.
This title may be cited as the ``Taxpayer Protection and
IRS Accountability Act of 2002''.
Subtitle A--Penalties and Interest
SEC. 211. FAILURE TO PAY ESTIMATED TAX PENALTY CONVERTED TO
INTEREST CHARGE ON ACCUMULATED UNPAID BALANCE.
(a) Penalty Moved to Interest Chapter of Code.--The
Internal Revenue Code of 1986 is amended by redesignating
section 6654 as section 6641 and by moving section 6641 (as
so redesignated) from part I of subchapter A of chapter 68 to
the end of subchapter E of chapter 67 (as added by subsection
(e)(1) of this section).
(b) Penalty Converted to Interest Charge.--The heading and
subsections (a) and (b) of section 6641 (as so redesignated)
are amended to read as follows:
``SEC. 6641. INTEREST ON FAILURE BY INDIVIDUAL TO PAY
ESTIMATED INCOME TAX.
``(a) In General.--Interest shall be paid on any
underpayment of estimated tax by an individual for a taxable
year for each day of such underpayment. The amount of such
interest for any day shall be the product of the underpayment
rate established under subsection (b)(2) multiplied by the
amount of the underpayment.
``(b) Amount of Underpayment; Interest Rate.--For purposes
of subsection (a)--
``(1) Amount.--The amount of the underpayment on any day
shall be the excess of--
``(A) the sum of the required installments for the taxable
year the due dates for which are on or before such day, over
``(B) the sum of the amounts (if any) of estimated tax
payments made on or before such day on such required
installments.
``(2) Determination of interest rate.--
``(A) In general.--The underpayment rate with respect to
any day in an installment underpayment period shall be the
underpayment rate established under section 6621 for the
first day of the calendar quarter in which such installment
underpayment period begins.
``(B) Installment underpayment period.--For purposes of
subparagraph (A), the term `installment underpayment period'
means the period beginning on the day after the due date for
a required installment and ending on the due date for the
subsequent required installment (or in the case of the 4th
required installment, the 15th day of the 4th month following
the close of a taxable year).
``(C) Daily rate.--The rate determined under subparagraph
(A) shall be applied on a daily basis and shall be based on
the assumption of 365 days in a calendar year.
``(3) Termination of estimated tax interest.--No day after
the end of the installment underpayment period for the 4th
required installment specified in paragraph (2)(B) for a
taxable year shall be treated as a day of underpayment with
respect to such taxable year.''.
(c) Increase in Safe Harbor Where Tax is Small.--
(1) In general.--Clause (i) of section 6641(d)(1)(B) (as so
redesignated) is amended to read as follows:
``(i) the lesser of--
``(I) 90 percent of the tax shown on the return for the
taxable year (or, if no return is filed, 90 percent of the
tax for such year), or
``(II) the tax shown on the return for the taxable year
(or, if no return is filed, the tax for such year) reduced
(but not below zero) by $2,000, or''.
(2) Conforming amendment.--Subsection (e) of section 6641
(as so redesignated) is amended by striking paragraph (1) and
redesignating paragraphs (2) and (3) as paragraphs (1) and
(2), respectively.
(d) Conforming Amendments.--
(1) Paragraphs (1) and (2) of subsection (e) (as
redesignated by subsection (c)(2)) and subsection (h) of
section 6641 (as so designated) are each amended by striking
``addition to tax'' each place it occurs and inserting
``interest''.
(2) Section 167(g)(5)(D) is amended by striking ``6654''
and inserting ``6641''.
(3) Section 460(b)(1) is amended by striking ``6654'' and
inserting ``6641''.
(4) Section 3510(b) is amended--
(A) by striking ``section 6654'' in paragraph (1) and
inserting ``section 6641'';
(B) by amending paragraph (2)(B) to read as follows:
``(B) no interest would be required to be paid (but for
this section) under 6641 for such taxable year by reason of
the $2,000 amount specified in section
6641(d)(1)(B)(i)(II).'';
(C) by striking ``section 6654(d)(2)'' in paragraph (3) and
inserting ``section 6641(d)(2)''; and
(D) by striking paragraph (4).
(5) Section 6201(b)(1) is amended by striking ``6654'' and
inserting ``6641''.
(6) Section 6601(h) is amended by striking ``6654'' and
inserting ``6641''.
(7) Section 6621(b)(2)(B) is amended by striking ``addition
to tax under section 6654'' and inserting ``interest required
to be paid under section 6641''.
(8) Section 6622(b) is amended--
(A) by striking ``Penalty for'' in the heading; and
(B) by striking ``addition to tax under section 6654 or
6655'' and inserting ``interest required to be paid under
section 6641 or addition to tax under section 6655''.
(9) Section 6658(a) is amended--
(A) by striking ``6654, or 6655'' and inserting ``or 6655,
and no interest shall be required to be paid under section
6641,''; and
(B) by inserting ``or paying interest'' after ``the tax''
in paragraph (2)(B)(ii).
(10) Section 6665(b) is amended--
(A) in the matter preceding paragraph (1) by striking ``,
6654,''; and
(B) in paragraph (2) by striking ``6654 or''.
(11) Section 7203 is amended by striking ``section 6654 or
6655'' and inserting ``section 6655 or interest required to
be paid under section 6641''.
(e) Clerical Amendments.--
[[Page H1431]]
(1) Chapter 67 is amended by inserting after subchapter D
the following:
``Subchapter E--Interest on Failure by Individual to Pay Estimated
Income Tax
``Sec. 6641. Interest on failure by individual to pay estimated income
tax.''.
(2) The table of subchapters for chapter 67 is amended by
adding at the end the following new items:
``Subchapter D. Notice requirements.
``Subchapter E. Interest on failure by individual to pay estimated
income tax.''.
(3) The table of sections for part I of subchapter A of
chapter 68 is amended by striking the item relating to
section 6654.
(f) Effective Date.--The amendments made by this section
shall apply to installment payments for taxable years
beginning after December 31, 2002.
SEC. 212. EXCLUSION FROM GROSS INCOME FOR INTEREST ON
OVERPAYMENTS OF INCOME TAX BY INDIVIDUALS.
(a) In General.--Part III of subchapter B of chapter 1
(relating to items specifically excluded from gross income)
is amended by inserting after section 139 the following new
section:
``SEC. 139A. EXCLUSION FROM GROSS INCOME FOR INTEREST ON
OVERPAYMENTS OF INCOME TAX BY INDIVIDUALS.
``(a) In General.--In the case of an individual, gross
income shall not include interest paid under section 6611 on
any overpayment of tax imposed by this subtitle.
``(b) Exception.--Subsection (a) shall not apply in the
case of a failure to claim items resulting in the overpayment
on the original return if the Secretary determines that the
principal purpose of such failure is to take advantage of
subsection (a).
``(c) Special Rule for Determining Modified Adjusted Gross
Income.--For purposes of this title, interest not included in
gross income under subsection (a) shall not be treated as
interest which is exempt from tax for purposes of sections
32(i)(2)(B) and 6012(d) or any computation in which interest
exempt from tax under this title is added to adjusted gross
income.''.
(b) Clerical Amendment.--The table of sections for part III
of subchapter B of chapter 1 is amended by inserting after
the item relating to section 139 the following new item:
``Sec. 139A. Exclusion from gross income for interest on overpayments
of income tax by individuals.''.
(c) Effective Date.--The amendments made by this section
shall apply to interest received in calendar years beginning
after the date of the enactment of this Act.
SEC. 213. ABATEMENT OF INTEREST.
(a) Abatement of Interest With Respect to Erroneous Refund
Check Without Regard to Size of Refund.--Paragraph (2) of
section 6404(e) is amended by striking ``unless--'' and all
that follows and inserting ``unless the taxpayer (or a
related party) has in any way caused such erroneous
refund.''.
(b) Abatement of Interest to Extent Interest is
Attributable to Taxpayer Reliance on Written Statements of
the IRS.--Subsection (f) of section 6404 is amended--
(1) in the subsection heading, by striking ``Penalty or
Addition'' and inserting ``Interest, Penalty, or Addition'';
and
(2) in paragraph (1) and in subparagraph (B) of paragraph
(2), by striking ``penalty or addition'' and inserting
``interest, penalty, or addition''.
(c) Effective Date.--The amendments made by this section
shall apply with respect to interest accruing on or after the
date of the enactment of this Act.
SEC. 214. DEPOSITS MADE TO SUSPEND RUNNING OF INTEREST ON
POTENTIAL UNDERPAYMENTS.
(a) In General.--Subchapter A of chapter 67 (relating to
interest on underpayments) is amended by adding at the end
the following new section:
``SEC. 6603. DEPOSITS MADE TO SUSPEND RUNNING OF INTEREST ON
POTENTIAL UNDERPAYMENTS, ETC.
``(a) Authority To Make Deposits Other Than As Payment of
Tax.--A taxpayer may make a cash deposit with the Secretary
which may be used by the Secretary to pay any tax imposed
under subtitle A or B or chapter 41, 42, 43, or 44 which has
not been assessed at the time of the deposit. Such a deposit
shall be made in such manner as the Secretary shall
prescribe.
``(b) No Interest Imposed.--To the extent that such deposit
is used by the Secretary to pay tax, for purposes of section
6601 (relating to interest on underpayments), the tax shall
be treated as paid when the deposit is made.
``(c) Return of Deposit.--Except in a case where the
Secretary determines that collection of tax is in jeopardy,
the Secretary shall return to the taxpayer any amount of the
deposit (to the extent not used for a payment of tax) which
the taxpayer requests in writing.
``(d) Payment of Interest.--
``(1) In general.--For purposes of section 6611 (relating
to interest on overpayments), a deposit which is returned to
a taxpayer shall be treated as a payment of tax for any
period to the extent (and only to the extent) attributable to
a disputable tax for such period. Under regulations
prescribed by the Secretary, rules similar to the rules of
section 6611(b)(2) shall apply.
``(2) Disputable tax.--
``(A) In general.--For purposes of this section, the term
`disputable tax' means the amount of tax specified at the
time of the deposit as the taxpayer's reasonable estimate of
the maximum amount of any tax attributable to disputable
items.
``(B) Safe harbor based on 30-day letter.--In the case of a
taxpayer who has been issued a 30-day letter, the maximum
amount of tax under subparagraph (A) shall not be less than
the amount of the proposed deficiency specified in such
letter.
``(3) Other definitions.--For purposes of paragraph (2)--
``(A) Disputable item.--The term `disputable item' means
any item of income, gain, loss, deduction, or credit if the
taxpayer--
``(i) has a reasonable basis for its treatment of such
item, and
``(ii) reasonably believes that the Secretary also has a
reasonable basis for disallowing the taxpayer's treatment of
such item.
``(B) 30-day letter.--The term `30-day letter' means the
first letter of proposed deficiency which allows the taxpayer
an opportunity for administrative review in the Internal
Revenue Service Office of Appeals.
``(4) Rate of interest.--The rate of interest allowable
under this subsection shall be the Federal short-term rate
determined under section 6621(b), compounded daily.
``(e) Use of Deposits.--
``(1) Payment of tax.--Except as otherwise provided by the
taxpayer, deposits shall be treated as used for the payment
of tax in the order deposited.
``(B) Returns of deposits.--Deposits shall be treated as
returned to the taxpayer on a last-in, first-out basis.''.
(b) Clerical Amendment.--The table of sections for
subchapter A of chapter 67 is amended by adding at the end
the following new item:
``Sec. 6603. Deposits made to suspend running of interest on potential
underpayments, etc.''.
(c) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to deposits made after the date of the enactment of
this Act.
(2) Coordination with deposits made under revenue procedure
84-58.--In the case of an amount held by the Secretary of the
Treasury or his delegate on the date of the enactment of this
Act as a deposit in the nature of a cash bond deposit
pursuant to Revenue Procedure 84-58, the date that the
taxpayer identifies such amount as a deposit made pursuant to
section 6603 of the Internal Revenue Code (as added by this
Act) shall be treated as the date such amount is deposited
for purposes of such section 6603.
SEC. 215. EXPANSION OF INTEREST NETTING FOR INDIVIDUALS.
(a) In General.--Subsection (d) of section 6621 (relating
to elimination of interest on overlapping periods of tax
overpayments and underpayments) is amended by adding at the
end the following: ``Solely for purposes of the preceding
sentence, section 6611(e) shall not apply in the case of an
individual.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to interest accrued after December 31, 2002.
SEC. 216. WAIVER OF CERTAIN PENALTIES FOR FIRST-TIME
UNINTENTIONAL MINOR ERRORS.
(a) In General.--Section 6651 (relating to failure to file
tax return or to pay tax) is amended by adding at the end the
following new subsection:
``(i) Treatment of First-Time Unintentional Minor Errors.--
``(1) In general.--In the case of a return of tax imposed
by subtitle A filed by an individual, the Secretary may waive
an addition to tax under subsection (a) if--
``(A) the individual has a history of compliance with the
requirements of this title,
``(B) it is shown that the failure is due to an
unintentional minor error,
``(C) the penalty would be grossly disproportionate to the
action or expense that would have been needed to avoid the
error, and imposing the penalty would be against equity and
good conscience,
``(D) waiving the penalty would promote compliance with the
requirements of this title and effective tax administration,
and
``(E) the taxpayer took all reasonable steps to remedy the
error promptly after discovering it.
``(2) Exceptions.--Paragraph (1) shall not apply if--
``(A) the Secretary has waived any addition to tax under
this subsection with respect to any prior failure by such
individual,
``(B) the failure is a mathematical or clerical error (as
defined in section 6213(g)(2)), or
``(C) the failure is the lack of a required signature.''.
(b) Effective Date.--The amendment made by this section
shall take effect on January 1, 2003.
SEC. 217. FRIVOLOUS TAX SUBMISSIONS.
(a) Civil Penalties.--Section 6702 is amended to read as
follows:
``SEC. 6702. FRIVOLOUS TAX SUBMISSIONS.
``(a) Civil Penalty for Frivolous Tax Returns.--A person
shall pay a penalty of $5,000 if--
``(1) such person files what purports to be a return of a
tax imposed by this title but which--
``(A) does not contain information on which the substantial
correctness of the self-assessment may be judged, or
``(B) contains information that on its face indicates that
the self-assessment is substantially incorrect; and
``(2) the conduct referred to in paragraph (1)--
[[Page H1432]]
``(A) is based on a position which the Secretary has
identified as frivolous under subsection (c), or
``(B) reflects a desire to delay or impede the
administration of Federal tax laws.
``(b) Civil Penalty for Specified Frivolous Submissions.--
``(1) Imposition of Penalty.--Except as provided in
paragraph (3), any person who submits a specified frivolous
submission shall pay a penalty of $5,000.
``(2) Specified frivolous submission.--For purposes of this
section--
``(A) Specified frivolous submission.--The term `specified
frivolous submission' means a specified submission if any
portion of such submission--
``(i) is based on a position which the Secretary has
identified as frivolous under subsection (c), or
``(ii) reflects a desire to delay or impede the
administration of Federal tax laws.
``(B) Specified submission.--The term `specified
submission' means--
``(i) a request for a hearing under--
``(I) section 6320 (relating to notice and opportunity for
hearing upon filing of notice of lien), or
``(II) section 6330 (relating to notice and opportunity for
hearing before levy), and
``(ii) an application under--
``(I) section 7811 (relating to taxpayer assistance
orders),
``(II) section 6159 (relating to agreements for payment of
tax liability in installments), or
``(III) section 7122 (relating to compromises).
``(3) Opportunity to withdraw submission.--If the Secretary
provides a person with notice that a submission is a
specified frivolous submission and such person withdraws such
submission promptly after such notice, the penalty imposed
under paragraph (1) shall not apply with respect to such
submission.
``(c) Listing of Frivolous Positions.--The Secretary shall
prescribe (and periodically revise) a list of positions which
the Secretary has identified as being frivolous for purposes
of this subsection. The Secretary shall not include in such
list any position that the Secretary determines meets the
requirement of section 6662(d)(2)(B)(ii)(II).
``(d) Reduction of Penalty.--The Secretary may reduce the
amount of any penalty imposed under this section if the
Secretary determines that such reduction would promote
compliance with and administration of the Federal tax laws.
``(e) Penalties in Addition to Other Penalties.--The
penalties imposed by this section shall be in addition to any
other penalty provided by law.''.
(b) Treatment of Frivolous Requests for Hearings Before
Levy.--
(1) Frivolous requests disregarded.--Section 6330 (relating
to notice and opportunity for hearing before levy) is amended
by adding at the end the following new subsection:
``(g) Frivolous Requests for Hearing, Etc.--Notwithstanding
any other provision of this section, if the Secretary
determines that any portion of a request for a hearing under
this section or section 6320 meets the requirement of clause
(i) or (ii) of section 6702(b)(2)(A), then the Secretary may
treat such portion as if it were never submitted and such
portion shall not be subject to any further administrative or
judicial review.''.
(2) Preclusion from raising frivolous issues at hearing.--
Section 6330(c)(4) is amended--
(A) by striking ``(A)'' and inserting ``(A)(i)'';
(B) by striking ``(B)'' and inserting ``(ii)'';
(C) by striking the period at the end of the first sentence
and inserting ``; or''; and
(D) by inserting after subparagraph (A)(ii) (as so
redesignated) the following:
``(B) the issue meets the requirement of clause (i) or (ii)
of section 6702(b)(2)(A).''.
(3) Statement of grounds.--Section 6330(b)(1) is amended by
striking ``under subsection (a)(3)(B)'' and inserting ``in
writing under subsection (a)(3)(B) and states the grounds for
the requested hearing''.
(c) Treatment of Frivolous Requests for Hearings Upon
Filing of Notice of Lien.--Section 6320 is amended--
(1) in subsection (b)(1), by striking ``under subsection
(a)(3)(B)'' and inserting ``in writing under subsection
(a)(3)(B) and states the grounds for the requested hearing'',
and
(2) in subsection (c), by striking ``and (e)'' and
inserting ``(e), and (g)''.
(d) Treatment of Frivolous Applications for Offers-in-
Compromise and Installment Agreements.--Section 7122 is
amended by adding at the end the following new subsection:
``(e) Frivolous Submissions, Etc.--Notwithstanding any
other provision of this section, if the Secretary determines
that any portion of an application for an offer-in-compromise
or installment agreement submitted under this section or
section 6159 meets the requirement of clause (i) or (ii) of
section 6702(b)(2)(A), then the Secretary may treat such
portion as if it were never submitted and such portion shall
not be subject to any further administrative or judicial
review.''.
(e) Clerical Amendment.--The table of sections for part I
of subchapter B of chapter 68 is amended by striking the item
relating to section 6702 and inserting the following new
item:
``Sec. 6702. Frivolous tax submissions.''.
(f) Effective Date.--The amendments made by this section
shall apply to submissions made and issues raised after the
date on which the Secretary first prescribes a list under
section 6702(c) of the Internal Revenue Code of 1986, as
amended by subsection (a).
SEC. 218. CLARIFICATION OF APPLICATION OF FEDERAL TAX DEPOSIT
PENALTY.
Nothing in section 6656 of the Internal Revenue Code of
1986 shall be construed to permit the percentage specified in
subsection (b)(1)(A)(iii) thereof to apply other than in a
case where the failure is for more than 15 days.
Subtitle B--Fairness of Collection Procedures
SEC. 221. PARTIAL PAYMENT OF TAX LIABILITY IN INSTALLMENT
AGREEMENTS.
(a) In General.--
(1) Section 6159(a) (relating to authorization of
agreements) is amended--
(A) by striking ``satisfy liability for payment of'' and
inserting ``make payment on'', and
(B) by inserting ``full or partial'' after ``facilitate''.
(2) Section 6159(c) (relating to Secretary required to
enter into installment agreements in certain cases) is
amended in the matter preceding paragraph (1) by inserting
``full'' before ``payment''.
(b) Requirement To Review Partial Payment Agreements Every
Two Years.--Section 6159 is amended by redesignating
subsections (d) and (e) as subsections (e) and (f),
respectively, and inserting after subsection (c) the
following new subsection:
``(d) Secretary Required To Review Installment Agreements
for Partial Collection Every Two Years.--In the case of an
agreement entered into by the Secretary under subsection (a)
for partial collection of a tax liability, the Secretary
shall review the agreement at least once every 2 years.''.
(c) Effective Date.--The amendments made by this section
shall apply to agreements entered into on or after the date
of the enactment of this Act.
SEC. 222. EXTENSION OF TIME FOR RETURN OF PROPERTY.
(a) Extension of Time for Return of Property Subject to
Levy.--Subsection (b) of section 6343 (relating to return of
property) is amended by striking ``9 months'' and inserting
``2 years''.
(b) Period of Limitation on Suits.--Subsection (c) of
section 6532 (relating to suits by persons other than
taxpayers) is amended--
(1) in paragraph (1) by striking ``9 months'' and inserting
``2 years'', and
(2) in paragraph (2) by striking ``9-month'' and inserting
``2-year''.
(c) Effective Date.--The amendments made by this section
shall apply to--
(1) levies made after the date of the enactment of this
Act, and
(2) levies made on or before such date if the 9-month
period has not expired under section 6343(b) of the Internal
Revenue Code of 1986 (without regard to this section) as of
such date.
SEC. 223. INDIVIDUALS HELD HARMLESS ON WRONGFUL LEVY, ETC. ON
INDIVIDUAL RETIREMENT PLAN.
(a) In General.--Section 6343 (relating to authority to
release levy and return property) is amended by adding at the
end the following new subsection:
``(f) Individuals Held Harmless on Wrongful Levy, Etc. on
Individual Retirement Plan.--
``(1) In general.--If the Secretary determines that an
individual retirement plan has been levied upon in a case to
which subsection (b) or (d)(2)(A) applies, an amount equal to
the sum of--
``(A) the amount of money returned by the Secretary on
account of such levy, and
``(B) interest paid under subsection (c) on such amount of
money,
may be deposited into an individual retirement plan (other
than an endowment contract) to which a rollover from the plan
levied upon is permitted.
``(2) Treatment as rollover.--The distribution on account
of the levy and any deposit under paragraph (1) with respect
to such distribution shall be treated for purposes of this
title as if such distribution and deposit were part of a
rollover described in section 408(d)(3)(A)(i); except that--
``(A) interest paid under subsection (c) shall be treated
as part of such distribution and as not includible in gross
income,
``(B) the 60-day requirement in such section shall be
treated as met if the deposit is made not later than the 60th
day after the day on which the individual receives an amount
under paragraph (1) from the Secretary, and
``(C) such deposit shall not be taken into account under
section 408(d)(3)(B).
``(3) Refund, etc., of income tax on levy.--If any amount
is includible in gross income for a taxable year by reason of
a levy referred to in paragraph (1) and any portion of such
amount is treated as a rollover under paragraph (2), any tax
imposed by chapter 1 on such portion shall not be assessed,
and if assessed shall be abated, and if collected shall be
credited or refunded as an overpayment made on the due date
for filing the return of tax for such taxable year.
``(4) Interest.--Notwithstanding subsection (d), interest
shall be allowed under subsection (c) in a case in which the
Secretary makes a determination described in subsection
(d)(2)(A) with respect to a levy upon an individual
retirement plan.''.
(b) Effective Date.--The amendment made by this section
shall apply to amounts paid under subsections (b), (c), and
(d)(2)(A) of section 6343 of the Internal Revenue Code of
1986 after December 31, 2002.
[[Page H1433]]
SEC. 224. SEVEN-DAY THRESHOLD ON TOLLING OF STATUTE OF
LIMITATIONS DURING TAX REVIEW.
(a) In General.--Section 7811(d)(1) (relating to suspension
of running of period of limitation) is amended by inserting
after ``application,'' the following: ``but only if the date
of such decision is at least 7 days after the date of the
taxpayer's application''.
(b) Effective Date.--The amendment made by this section
shall apply to applications filed after the date of the
enactment of this Act.
SEC. 225. STUDY OF LIENS AND LEVIES.
The Secretary of the Treasury, or the Secretary's delegate,
shall conduct a study of the practices of the Internal
Revenue Service concerning liens and levies. The study shall
examine--
(1) the declining use of liens and levies by the Internal
Revenue Service, and
(2) the practicality of recording liens and levying against
property in cases in which the cost of such actions exceeds
the amount to be realized from such property.
Not later than 1 year after the date of the enactment of this
Act, the Secretary shall submit such study to the Committee
on Ways and Means of the House of Representatives and the
Committee on Finance of the Senate.
Subtitle C--Efficiency of Tax Administration
SEC. 231. REVISIONS RELATING TO TERMINATION OF EMPLOYMENT OF
INTERNAL REVENUE SERVICE EMPLOYEES FOR
MISCONDUCT.
(a) In General.--Subchapter A of chapter 80 (relating to
application of internal revenue laws) is amended by inserting
after section 7804 the following new section:
``SEC. 7804A. DISCIPLINARY ACTIONS FOR MISCONDUCT.
``(a) Disciplinary Actions.--
``(1) In general.--Subject to subsection (c), the
Commissioner shall take an action in accordance with the
guidelines established under paragraph (2) against any
employee of the Internal Revenue Service if there is a final
administrative or judicial determination that such employee
committed any act or omission described under subsection (b)
in the performance of the employee's official duties or where
a nexus to the employee's position exists.
``(2) Guidelines.--The Commissioner shall issue guidelines
for determining the appropriate level of discipline, up to
and including termination of employment, for committing any
act or omission described under subsection (b).
``(b) Acts or Omissions.--The acts or omissions described
under this subsection are--
``(1) willful failure to obtain the required approval
signatures on documents authorizing the seizure of a
taxpayer's home, personal belongings, or business assets;
``(2) willfully providing a false statement under oath with
respect to a material matter involving a taxpayer or taxpayer
representative;
``(3) with respect to a taxpayer or taxpayer
representative, the willful violation of--
``(A) any right under the Constitution of the United
States;
``(B) any civil right established under--
``(i) title VI or VII of the Civil Rights Act of 1964;
``(ii) title IX of the Education Amendments of 1972;
``(iii) the Age Discrimination in Employment Act of 1967;
``(iv) the Age Discrimination Act of 1975;
``(v) section 501 or 504 of the Rehabilitation Act of 1973;
or
``(vi) title I of the Americans with Disabilities Act of
1990; or
``(C) the Internal Revenue Service policy on unauthorized
inspection of returns or return information;
``(4) willfully falsifying or destroying documents to
conceal mistakes made by any employee with respect to a
matter involving a taxpayer or taxpayer representative;
``(5) assault or battery on a taxpayer or taxpayer
representative, but only if there is a criminal conviction,
or a final adverse judgment by a court in a civil case, with
respect to the assault or battery;
``(6) willful violations of this title, Department of the
Treasury regulations, or policies of the Internal Revenue
Service (including the Internal Revenue Manual) for the
purpose of retaliating against, or harassing, a taxpayer or
taxpayer representative;
``(7) willful misuse of the provisions of section 6103 for
the purpose of concealing information from a congressional
inquiry;
``(8) willful failure to file any return of tax required
under this title on or before the date prescribed therefor
(including any extensions) when a tax is due and owing,
unless such failure is due to reasonable cause and not due to
willful neglect;
``(9) willful understatement of Federal tax liability,
unless such understatement is due to reasonable cause and not
due to willful neglect; and
``(10) threatening to audit a taxpayer, or to take other
action under this title, for the purpose of extracting
personal gain or benefit.
``(c) Determinations of Commissioner.--
``(1) In general.--The Commissioner may take a personnel
action other than a disciplinary action provided for in the
guidelines under subsection (a)(2) for an act or omission
described under subsection (b).
``(2) Discretion.--The exercise of authority under
paragraph (1) shall be at the sole discretion of the
Commissioner and may not be delegated to any other officer.
The Commissioner, in his sole discretion, may establish a
procedure to determine if an individual should be referred to
the Commissioner for a determination by the Commissioner
under paragraph (1).
``(3) No appeal.--Notwithstanding any other provision of
law, any determination of the Commissioner under this
subsection may not be reviewed in any administrative or
judicial proceeding. A finding that an act or omission
described under subsection (b) occurred may be reviewed.
``(d) Definition.--For the purposes of the provisions
described in clauses (i), (ii), and (iv) of subsection
(b)(3)(B), references to a program or activity regarding
Federal financial assistance or an education program or
activity receiving Federal financial assistance shall include
any program or activity conducted by the Internal Revenue
Service for a taxpayer.
``(e) Annual Report.--The Commissioner shall submit to
Congress annually a report on disciplinary actions under this
section.''.
(b) Clerical Amendment.--The table of sections for chapter
80 is amended by inserting after the item relating to section
7804 the following new item:
``Sec. 7804A. Disciplinary actions for misconduct.''.
(c) Repeal of Superseded Section.--Section 1203 of the
Internal Revenue Service Restructuring and Reform Act of 1998
(Public Law 105-206; 112 Stat. 720) is repealed.
(d) Effective Date.--The amendments made by this section
shall take effect on the date of the enactment of this Act.
SEC. 232. CONFIRMATION OF AUTHORITY OF TAX COURT TO APPLY
DOCTRINE OF EQUITABLE RECOUPMENT.
(a) Confirmation of Authority of Tax Court To Apply
Doctrine of Equitable Recoupment.--Subsection (b) of section
6214 (relating to jurisdiction over other years and quarters)
is amended by adding at the end the following new sentence:
``Notwithstanding the preceding sentence, the Tax Court may
apply the doctrine of equitable recoupment to the same extent
that it is available in civil tax cases before the district
courts of the United States and the United States Court of
Federal Claims.''.
(b) Effective Date.--The amendments made by this section
shall apply to any action or proceeding in the Tax Court with
respect to which a decision has not become final (as
determined under section 7481 of the Internal Revenue Code of
1986) as of the date of the enactment of this Act.
SEC. 233. JURISDICTION OF TAX COURT OVER COLLECTION DUE
PROCESS CASES.
(a) In General.--Section 6330(d)(1) (relating to judicial
review of determination) is amended to read as follows:
``(1) Judicial review of determination.--The person may,
within 30 days of a determination under this section, appeal
such determination to the Tax Court (and the Tax Court shall
have jurisdiction with respect to such matter).''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to judicial appeals filed after the date of the
enactment of this Act.
SEC. 234. OFFICE OF CHIEF COUNSEL REVIEW OF OFFERS IN
COMPROMISE.
(a) In General.--Section 7122(b) (relating to record) is
amended by striking ``Whenever a compromise'' and all that
follows through ``his delegate'' and inserting ``If the
Secretary determines that an opinion of the General Counsel
for the Department of the Treasury, or the Counsel's
delegate, is required with respect to a compromise, there
shall be placed on file in the office of the Secretary such
opinion''.
(b) Conforming Amendments.--Section 7122(b) is amended by
striking the second and third sentences.
(c) Effective Date.--The amendments made by this section
shall apply to offers-in-compromise submitted or pending on
or after the date of the enactment of this Act.
SEC. 235. 15-DAY DELAY IN DUE DATE FOR ELECTRONICALLY FILED
INDIVIDUAL INCOME TAX RETURNS.
(a) In General.--Section 6072 (relating to time for filing
income tax returns) is amended by adding at the end the
following new subsection:
``(f) Electronically Filed Returns of Individuals.--
``(1) In general.--Returns of an individual under section
6012 or 6013 (other than an individual to whom subsection (c)
applies) which are filed electronically--
``(A) in the case of returns filed on the basis of a
calendar year, shall be filed on or before the 30th day of
April following the close of the calendar year, and
``(B) in the case of returns filed on the basis of a fiscal
year, shall be filed on or before the last day of the 4th
month following the close of the fiscal year.
``(2) Electronic filing.--Paragraph (1) shall not apply to
any return unless--
``(A) such return is accepted by the Secretary, and
``(B) the balance due (if any) shown on such return is paid
electronically in a manner prescribed by the Secretary.
``(3) Special rules.--
``(A) Estimated tax.--If--
``(i) paragraph (1) applies to an individual for any
taxable year, and
``(ii) there is an overpayment of tax shown on the return
for such year which the individual allows against the
individual's obligation under section 6641,
[[Page H1434]]
then, with respect to the amount so allowed, any reference in
section 6641 to the April 15 following such taxable year
shall be treated as a reference to April 30.
``(B) References to due date.--Paragraph (1) shall apply
solely for purposes of determining the due date for the
individual's obligation to file and pay tax and, except as
otherwise provided by the Secretary, shall be treated as an
extension of the due date for any other purpose under this
title.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2001.
Subtitle D--Confidentiality and Disclosure
SEC. 241. COLLECTION ACTIVITIES WITH RESPECT TO JOINT RETURN
DISCLOSABLE TO EITHER SPOUSE BASED ON ORAL
REQUEST.
(a) In General.--Paragraph (8) of section 6103(e) (relating
to disclosure of collection activities with respect to joint
return) is amended by striking ``in writing'' the first place
it appears.
(b) Effective Date.--The amendment made by this section
shall apply to requests made after the date of the enactment
of this Act.
SEC. 242. TAXPAYER REPRESENTATIVES NOT SUBJECT TO EXAMINATION
ON SOLE BASIS OF REPRESENTATION OF TAXPAYERS.
(a) In General.--Subsection (h) of section 6103 (relating
to disclosure to certain Federal officers and employees for
purposes of tax administration, etc.) is amended by adding at
the end the following new paragraph:
``(7) Taxpayer representatives.--Notwithstanding paragraph
(1), the return of the representative of a taxpayer whose
return is being examined by an officer or employee of the
Department of the Treasury shall not be open to inspection by
such officer or employee on the sole basis of the
representative's relationship to the taxpayer unless a
supervisor of such officer or employee has approved the
inspection of the return of such representative on a basis
other than by reason of such relationship.''.
(b) Effective Date.--The amendment made by this section
shall take effect on the date of the enactment of this Act.
SEC. 243. DISCLOSURE IN JUDICIAL OR ADMINISTRATIVE TAX
PROCEEDINGS OF RETURN AND RETURN INFORMATION OF
PERSONS WHO ARE NOT PARTY TO SUCH PROCEEDINGS.
(a) In General.--Paragraph (4) of section 6103(h) (relating
to disclosure to certain Federal officers and employees for
purposes of tax administration, etc.) is amended by adding at
the end the following new subparagraph:
``(B) Disclosure in judicial or administrative tax
proceedings of return and return information of persons not
party to such proceedings.--
``(i) Notice.--Return or return information of any person
who is not a party to a judicial or administrative proceeding
described in this paragraph shall not be disclosed under
clause (ii) or (iii) of subparagraph (A) until after the
Secretary makes a reasonable effort to give notice to such
person and an opportunity for such person to request the
deletion of matter from such return or return information,
including any of the items referred to in paragraphs (1)
through (7) of section 6110(c). Such notice shall include a
statement of the issue or issues the resolution of which is
the reason such return or return information is sought. In
the case of S corporations, partnerships, estates, and
trusts, such notice shall be made at the entity level.
``(ii) Disclosure limited to pertinent portion.--The only
portion of a return or return information described in clause
(i) which may be disclosed under subparagraph (A) is that
portion of such return or return information that directly
relates to the resolution of an issue in such proceeding.
``(iii) Exceptions.--Clause (i) shall not apply--
``(I) to any civil action under section 7407, 7408, or
7409,
``(II) to any ex parte proceeding for obtaining a search
warrant, order for entry on premises or safe deposit boxes,
or similar ex parte proceeding,
``(III) to disclosure of third party return information by
indictment or criminal information, or
``(IV) if the Attorney General or the Attorney General's
delegate determines that the application of such clause would
seriously impair a criminal tax investigation or
proceeding.''.
(b) Conforming Amendments.--Paragraph (4) of section
6103(h) is amended by--
(1) by striking ``proceedings.--A return'' and inserting
``proceedings.--
``(A) In general.--Except as provided in subparagraph (B),
a return'';
(2) by redesignating subparagraphs (A), (B), (C), and (D)
as clauses (i), (ii), (iii), and (iv), respectively; and
(3) in the matter following clause (iv) (as so
redesignated), by striking ``subparagraph (A), (B), or (C)''
and inserting ``clause (i), (ii), or (iii)'' and by moving
such matter 2 ems to the right.
(c) Effective Date.--The amendments made by this section
shall apply to proceedings commenced after the date of the
enactment of this Act.
SEC. 244. PROHIBITION OF DISCLOSURE OF TAXPAYER
IDENTIFICATION INFORMATION WITH RESPECT TO
DISCLOSURE OF ACCEPTED OFFERS-IN-COMPROMISE.
(a) In General.--Paragraph (1) of section 6103(k) (relating
to disclosure of certain returns and return information for
tax administrative purposes) is amended by inserting ``(other
than the taxpayer's address and TIN)'' after ``Return
information''.
(b) Effective Date.--The amendment made by this section
shall apply to disclosures made after the date of the
enactment of this Act.
SEC. 245. COMPLIANCE BY CONTRACTORS WITH CONFIDENTIALITY
SAFEGUARDS.
(a) In General.--Section 6103(p) (relating to State law
requirements) is amended by adding at the end the following
new paragraph:
``(9) Disclosure to contractors.--Notwithstanding any other
provision of this section, no return or return information
shall be disclosed by any officer or employee of any Federal
agency or State to any contractor of such agency or State
unless such agency or State--
``(A) has requirements in effect which require each
contractor of such agency or State which would have access to
returns or return information to provide safeguards (within
the meaning of paragraph (4)) to protect the confidentiality
of such returns or return information,
``(B) agrees to conduct an annual, on-site review (mid-
point review in the case of contracts of less than 1 year in
duration) of each contractor to determine compliance with
such requirements,
``(C) submits the findings of the most recent review
conducted under subparagraph (B) to the Secretary as part of
the report required by paragraph (4)(E), and
``(D) certifies to the Secretary for the most recent annual
period that all contractors are in compliance with all such
requirements.
The certification required by subparagraph (D) shall include
the name and address of each contractor, a description of the
contract of the contractor with the Federal agency or State,
and the duration of such contract.''.
(b) Conforming Amendment.--Subparagraph (B) of section
6103(p)(8) is amended by inserting ``or paragraph (9)'' after
``subparagraph (A)''.
(c) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to disclosures made after December 31, 2002.
(2) Certifications.--The first certification under section
6103(p)(9)(D) of the Internal Revenue Code of 1986, as added
by subsection (a), shall be made with respect to calendar
year 2003.
SEC. 246. HIGHER STANDARDS FOR REQUESTS FOR AND CONSENTS TO
DISCLOSURE.
(a) In General.--Subsection (c) of section 6103 (relating
to disclosure of returns and return information to designee
of taxpayer) is amended by adding at the end the following
new paragraphs:
``(2) Requirements for valid requests and consents.--A
request for or consent to disclosure under paragraph (1)
shall only be valid for purposes of this section or sections
7213, 7213A, or 7431 if--
``(A) at the time of execution, such request or consent
designates a recipient of such disclosure and is dated, and
``(B) at the time such request or consent is submitted to
the Secretary, the submitter of such request or consent
certifies, under penalty of perjury, that such request or
consent complied with subparagraph (A).
``(3) Restrictions on persons obtaining information.--Any
person shall, as a condition for receiving return or return
information under paragraph (1)--
``(A) ensure that such return and return information is
kept confidential,
``(B) use such return and return information only for the
purpose for which it was requested, and
``(C) not disclose such return and return information
except to accomplish the purpose for which it was requested,
unless a separate consent from the taxpayer is obtained.
``(4) Requirements for form prescribed by secretary.--For
purposes of this subsection, the Secretary shall prescribe a
form for requests and consents which shall--
``(A) contain a warning, prominently displayed, informing
the taxpayer that the form should not be signed unless it is
completed,
``(B) state that if the taxpayer believes there is an
attempt to coerce him to sign an incomplete or blank form,
the taxpayer should report the matter to the Treasury
Inspector General for Tax Administration, and
``(C) contain the address and telephone number of the
Treasury Inspector General for Tax Administration.''.
(b) Report.--Not later than 18 months after the date of the
enactment of this Act, the Treasury Inspector General for Tax
Administration shall submit a report to the Congress on
compliance with the designation and certification
requirements applicable to requests for or consent to
disclosure of returns and return information under section
6103(c) of the Internal Revenue Code of 1986, as amended by
subsection (a). Such report shall--
(1) evaluate (on the basis of random sampling) whether--
(A) the amendment made by subsection (a) is achieving the
purposes of this section;
(B) requesters and submitters for such disclosure are
continuing to evade the purposes of this section and, if so,
how; and
(C) the sanctions for violations of such requirements are
adequate; and
(2) include such recommendations that the Treasury
Inspector General for Tax Administration considers necessary
or appropriate to better achieve the purposes of this
section.
[[Page H1435]]
(c) Conforming Amendment.--Section 6103(c) is amended by
striking ``Taxpayer.--The Secretary'' and inserting
``Taxpayer.--
``(1) In General.--The Secretary''.
(d) Effective Date.--The amendments made by this section
shall apply to requests and consents made after 3 months
after the date of the enactment of this Act.
SEC. 247. NOTICE TO TAXPAYER CONCERNING ADMINISTRATIVE
DETERMINATION OF BROWSING; ANNUAL REPORT.
(a) Notice to Taxpayer.--Subsection (e) of section 7431
(relating to notification of unlawful inspection and
disclosure) is amended by adding at the end the following:
``The Secretary shall also notify such taxpayer if the
Treasury Inspector General for Tax Administration determines
that such taxpayer's return or return information was
inspected or disclosed in violation of any of the provisions
specified in paragraph (1), (2), or (3).''.
(b) Reports.--Subsection (p) of section 6103 (relating to
procedure and recordkeeping), as amended by section 245, is
further amended by adding at the end the following new
paragraph:
``(10) Report on unauthorized disclosure and inspection.--
As part of the report required by paragraph (3)(C) for each
calendar year, the Secretary shall furnish information
regarding the unauthorized disclosure and inspection of
returns and return information, including the number, status,
and results of--
``(A) administrative investigations,
``(B) civil lawsuits brought under section 7431 (including
the amounts for which such lawsuits were settled and the
amounts of damages awarded), and
``(C) criminal prosecutions.''.
(c) Effective Date.--
(1) Notice.--The amendment made by subsection (a) shall
apply to determinations made after the date of the enactment
of this Act.
(2) Reports.--The amendment made by subsection (b) shall
apply to calendar years ending after the date of the
enactment of this Act.
SEC. 248. EXPANDED DISCLOSURE IN EMERGENCY CIRCUMSTANCES.
(a) In General.--Section 6103(i)(3)(B) (relating to danger
of death or physical injury) is amended by striking ``or
State'' and inserting ``, State, or local''.
(b) Effective Date.--The amendment made by this section
shall take effect on the date of the enactment of this Act.
SEC. 249. DISCLOSURE OF TAXPAYER IDENTITY FOR TAX REFUND
PURPOSES.
(a) In General.--Paragraph (1) of section 6103(m) (relating
to disclosure of taxpayer identity information) is amended by
striking ``and other media'' and by inserting ``, other
media, and through any other means of mass communication,''.
(b) Effective Date.--The amendments made by this section
shall take effect on the date of the enactment of this Act.
Subtitle E--Miscellaneous
SEC. 251. CLARIFICATION OF DEFINITION OF CHURCH TAX INQUIRY.
Subsection (i) of section 7611 (relating to section not to
apply to criminal investigations, etc.) is amended by
striking ``or'' at the end of paragraph (4), by striking the
period at the end of paragraph (5) and inserting ``, or'',
and by inserting after paragraph (5) the following:
``(6) information provided by the Secretary related to the
standards for exemption from tax under this title and the
requirements under this title relating to unrelated business
taxable income.''.
SEC. 252. EXPANSION OF DECLARATORY JUDGMENT REMEDY TO TAX-
EXEMPT ORGANIZATIONS.
(a) In General.--Paragraph (1) of section 7428(a) (relating
to creation of remedy) is amended--
(1) in subparagraph (B) by inserting after ``509(a))'' the
following: ``or as a private operating foundation (as defined
in section 4942(j)(3))''; and
(2) by amending subparagraph (C) to read as follows:
``(C) with respect to the initial qualification or
continuing qualification of an organization as an
organization described in section 501(c) (other than
paragraph (3)) which is exempt from tax under section 501(a),
or''.
(b) Court Jurisdiction.--Subsection (a) of section 7428 is
amended in the material following paragraph (2) by striking
``United States Tax Court, the United States Claims Court, or
the district court of the United States for the District of
Columbia'' and inserting the following: ``United States Tax
Court (in the case of any such determination or failure) or
the United States Claims Court or the district court of the
United States for the District of Columbia (in the case of a
determination or failure with respect to an issue referred to
in subparagraph (A) or (B) of paragraph (1)),''.
(c) Effective Date.--The amendments made by this section
shall apply to pleadings filed with respect to determinations
(or requests for determinations) made after the date of the
enactment of this Act.
SEC. 253. EMPLOYEE MISCONDUCT REPORT TO INCLUDE SUMMARY OF
COMPLAINTS BY CATEGORY.
(a) In General.--Clause (ii) of section 7803(d)(2)(A) is
amended by inserting before the semicolon at the end the
following: ``, including a summary (by category) of the 10
most common complaints made and the number of such common
complaints''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply with respect to reporting periods ending after
the date of the enactment of this Act.
SEC. 254. ANNUAL REPORT ON AWARDS OF COSTS AND CERTAIN FEES
IN ADMINISTRATIVE AND COURT PROCEEDINGS.
Not later than 3 months after the close of each Federal
fiscal year after fiscal year 2001, the Treasury Inspector
General for Tax Administration shall submit a report to
Congress which specifies for such year--
(1) the number of payments made by the United States
pursuant to section 7430 of the Internal Revenue Code of 1986
(relating to awarding of costs and certain fees);
(2) the amount of each such payment;
(3) an analysis of any administrative issue giving rise to
such payments; and
(4) changes (if any) which will be implemented as a result
of such analysis and other changes (if any) recommended by
the Treasury Inspector General for Tax Administration as a
result of such analysis.
SEC. 255. ANNUAL REPORT ON ABATEMENT OF PENALTIES.
Not later than 6 months after the close of each Federal
fiscal year after fiscal year 2001, the Treasury Inspector
General for Tax Administration shall submit a report to
Congress on abatements of penalties under the Internal
Revenue Code of 1986 during such year, including information
on the reasons and criteria for such abatements.
SEC. 256. BETTER MEANS OF COMMUNICATING WITH TAXPAYERS.
Not later than 18 months after the date of the enactment of
this Act, the Treasury Inspector General for Tax
Administration shall submit a report to Congress evaluating
whether technological advances, such as e-mail and facsimile
transmission, permit the use of alternative means for the
Internal Revenue Service to communicate with taxpayers.
SEC. 257. EXPLANATION OF STATUTE OF LIMITATIONS AND
CONSEQUENCES OF FAILURE TO FILE.
The Secretary of the Treasury or the Secretary's delegate
shall, as soon as practicable but not later than 180 days
after the date of the enactment of this Act, revise the
statement required by section 6227 of the Omnibus Taxpayer
Bill of Rights (Internal Revenue Service Publication No. 1),
and any instructions booklet accompanying a general income
tax return form for taxable years beginning after 2001
(including forms 1040, 1040A, 1040EZ, and any similar or
successor forms relating thereto), to provide for an
explanation of--
(1) the limitations imposed by section 6511 of the Internal
Revenue Code of 1986 on credits and refunds; and
(2) the consequences under such section 6511 of the failure
to file a return of tax.
SEC. 258. AMENDMENT TO TREASURY AUCTION REFORMS.
(a) In General.--Clause (i) of section 202(c)(4)(B) of the
Government Securities Act Amendments of 1993 (31 U.S.C. 3121
note) is amended by inserting before the semicolon ``(or, if
earlier, at the time the Secretary releases the minutes of
the meeting in accordance with paragraph (2))''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to meetings held after the date of the enactment
of this Act.
SEC. 259. ENROLLED AGENTS.
(a) In General.--Chapter 77 (relating to miscellaneous
provisions) is amended by adding at the end the following new
section:
``SEC. 7527. ENROLLED AGENTS.
``(a) In General.--The Secretary may prescribe such
regulations as may be necessary to regulate the conduct of
enrolled agents in regards to their practice before the
Internal Revenue Service.
``(b) Use of Credentials.--Any enrolled agents properly
licensed to practice as required under rules promulgated
under section (a) herein shall be allowed to use the
credentials or designation as `enrolled agent', `EA', or
`E.A.'.''.
(b) Clerical Amendment.--The table of sections for chapter
77 is amended by adding at the end the following new item:
``Sec. 7525. Enrolled agents.''.
(c) Prior Regulations.--Nothing in the amendments made by
this section shall be construed to have any effect on part 10
of title 31, Code of Federal Regulations, or any other
Federal rule or regulation issued before the date of the
enactment of this Act.
SEC. 260. FINANCIAL MANAGEMENT SERVICE FEES.
Notwithstanding any other provision of law, the Financial
Management Service may charge the Internal Revenue Service,
and the Internal Revenue Service may pay the Financial
Management Service, a fee sufficient to cover the full cost
of implementing a continuous levy program under subsection
(h) of section 6331 of the Internal Revenue Code of 1986. Any
such fee shall be based on actual levies made and shall be
collected by the Financial Management Service by the
retention of a portion of amounts collected by levy pursuant
to that subsection. Amounts received by the Financial
Management Service as fees under that subsection shall be
deposited into the account of the Department of the Treasury
under section 3711(g)(7) of title 31, United States Code, and
shall be collected and accounted for in accordance with the
provisions of that section. The amount credited against the
taxpayer's liability on account of the continuous levy shall
be the
[[Page H1436]]
amount levied, without reduction for the amount paid to the
Financial Management Service as a fee.
SEC. 261. CAPITAL GAIN TREATMENT UNDER SECTION 631(B) TO
APPLY TO OUTRIGHT SALES BY LAND OWNER.
(a) In General.--The first sentence of section 631(b)
(relating to disposal of timber with a retained economic
interest) is amended by striking ``retains an economic
interest in such timber'' and inserting ``either retains an
economic interest in such timber or makes an outright sale of
such timber''.
(b) Conforming Amendment.--The third sentence of section
631(b) is amended by striking ``The date of disposal'' and
inserting ``In the case of disposal of timber with a retained
economic interest, the date of disposal''.
(c) Effective Date.--The amendments made by this section
shall apply to sales after the date of the enactment of this
Act.
SEC. 262. ACCELERATION OF EFFECTIVE DATE FOR EXPANSION OF
ADOPTION TAX CREDIT AND ADOPTION ASSISTANCE
PROGRAMS.
(a) In General.--Subsection (g) of section 202 of the
Economic Growth and Tax Relief Reconciliation Act of 2001 is
amended to read as follows:
``(g) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2001.''.
(b) Technical Corrections.--Paragraph (3) of section 411(c)
of the Job Creation and Worker Assistance Act of 2002 is
amended to read as follows:
``(3) Effective date.--The amendments made by this
subsection shall apply to taxable years beginning after
December 31, 2001.''.
Subtitle F--Low-Income Taxpayer Clinics
SEC. 271. LOW-INCOME TAXPAYER CLINICS.
(a) Limitation on Amount of Grants.--Paragraph (1) of
section 7526(c) (relating to special rules and limitations)
is amended by striking ``$6,000,000 per year'' and inserting
``$9,000,000 for 2002, $12,000,000 for 2003, and $15,000,000
for each year thereafter''.
(b) Limitation on Use of Clinics for Tax Return
Preparation.--Subparagraph (A) of section 7526(b)(1) is
amended by adding at the end the following flush language:
``The term does not include a clinic that provides routine
tax return preparation. The preceding sentence shall not
apply to return preparation in connection with a controversy
with the Internal Revenue Service.''.
(c) Promotion of Clinics.--Section 7526(c) is amended by
adding at the end the following new paragraph:
``(7) Promotion of clinics.--The Secretary is authorized to
promote the benefits of and encourage the use of low-income
taxpayer clinics through the use of mass communications,
referrals, and other means.''.
Amend the title so as to read: ``A bill to amend the
Internal Revenue Code of 1986 to make permanent the tax
reductions enacted by the Economic Growth and Tax Relief
Reconciliation Act of 2001 and to protect taxpayers and
ensure accountability of the Internal Revenue Service.''
The SPEAKER pro tempore. Pursuant to House Resolution 390, the
gentleman from California (Mr. Thomas) and the gentleman from New York
(Mr. Rangel) each will control 30 minutes.
The Chair recognizes the gentleman from California (Mr. Thomas).
{time} 1300
Mr. THOMAS. Mr. Speaker, I yield such time as he may consume to the
gentleman from Louisiana (Mr. McCrery).
(Mr. McCRERY asked and was given permission to revise and extend his
remarks, and include extraneous material.)
Mr. McCRERY. Mr. Speaker, I rise in support of the motion and of
making permanent the tax cuts enacted last year.
To me, the key consideration is ensuring the level of federal revenue
is sufficient to meet the needs of the government without imposing an
unsupportable burden on the governed.
Over the last 40 years, federal government revenues have averaged
about 18.2 percent of our gross domestic product. Some might argue that
this was too low to meet pressing needs. Others believe it is so high
as to stifle economic growth. But the fact is that while revenues
fluctuated somewhat, they were usually within 1 percent of that 40-year
average. That has changed in the last 4 years, as federal revenues as a
share of GDP rose to exceed 20 percent.
In January, the Congressional Budget Office confirmed that even with
the passage of the 2001 tax cuts, federal revenues will continue to be
close to 20 percent of GDP in every year of the 10-year budget window.
That is contrary to claims that the phased-in nature of the tax cut
will starve Washington of revenue in the second half of this decade.
The truth is that between 2006 and 2011, federal revenues as a share of
GDP will actually increase.
In fact, only three times between the end of World War II and 2001, a
span of more than five decades, did federal revenues consume a larger
share of our national income than they will in 2011. And those years
were 1998, 1999, and 2000.
The real question is whether, over the long-term, allowing the tax
cuts to sunset will increase federal revenues to an unsupportable
level.
A recent analysis by the General Accounting Office found that if the
tax cuts are made permanent and discretionary spending grows as fast as
the economy, federal revenues as a share of GDP will remain just under
19 percent for the next 50 years, still higher than historical levels.
If the sunset is allowed to occur, the GAO concluded revenues will rise
to 20.5 percent of national income every year through the end of their
75-year forecast period.
Looking back 70 years--a period which includes the Great Depression,
the New Deal, World War II, the Korean War, the Great Society, the
Vietnam War, and the oil embargo of the 1970s--federal revenues have
never exceed 20.5 percent of GDP for 2 consecutive years.
Mr. Speaker, I remain concerned about the drag on our economy which
results from having taxpayers send almost one in every five dollars of
our national income to Washington. We should certainly not allow the
2001 tax cuts to sunset, thereby further driving up the federal
government's take from the national income to historically high and
potentially unsupportable levels.
Mr. Speaker, I urge passage of this measure.
Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, we are going to engage in a debate about whether or not
the tax bill that was enacted into law last year does not end 10 years
from now, but, rather, is open-ended. We are going to hear a series of
statements which, frankly, will become very baffling to many people in
this debate trying to follow what it is that Members of Congress are
saying. I will try to provide a firm set of measuring tools as we get
into this debate.
Number one, no matter how many times it is going to be said that we
are invading, raiding, doing anything with the Social Security trust
fund, that statement is not true.
We will hear a number of dollar amounts thrown around. I guess $700
billion is a lot of money. I cannot comprehend it from a personal
revenue point of view. $1 trillion is a lot of money. The economy is
currently producing at about $10 trillion a year. It is very, very
difficult for most people, and I would say, frankly, for this Member
and most Members of Congress, to really put those dollar amounts in
some kind of context, so let me give you a little bit of a measurement
as you listen to this debate and as dollar amounts are thrown around
and the dire consequences given of actually letting the American people
permanently keep a little bit more of their own money.
If you would take a look at what this economy is going to produce
over the next 10 years by the best estimates and call that $1,000, what
we are talking about doing here on a permanent basis is about $2.30.
Or, to put it in a yearly basis, if every year of that 10-year $1,000
economy is $100, we are talking about this year's discussion being 23
cents.
Now, you are going to hear that it will reduce the Republic to
rubble, deny every senior their Social Security check, deny Medicare,
cause diaper rash and every other problem under the sun if, on the
economy being $100, we decide to utilize 23 cents to allow people to
make decisions on their own, which, frankly from a philosophical point
of view is a good guideline between Democrats and Republicans, because
we believe the best guarantee to have a surplus 10 years from now is to
give people their own money, to allow them to make decisions, to
invest, to grow, to be entrepreneurial, and we will have a bigger pie
in which more revenue comes in.
Listen carefully to the Democrat plan. They will say, ``We think it
is a good idea to have a tax cut if and when we think it is a good idea
to have a tax cut.'' I think you will find those 10 years will come and
go, and their belief is hanging on to it here in Washington guarantees
a better economy. In other words, they do not trust you.
We believe you should have more of your own money back. They were
willing to do it because they were forced to do it on a temporary
basis, and in no way do they want to make it permanent. That is what
this debate is all about.
Mr. Speaker, I reserve the balance of my time.
[[Page H1437]]
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, we have a lot of smart people in this world that cannot
even determine what the economy is going to look like next week, so it
is really extraordinary that we have someone that can give us a
forecast of what it looks like in the next 20 years.
Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from California
(Mr. Matsui), an outstanding member of the Committee on Ways and Means.
Mr. MATSUI. Mr. Speaker, I thank the ranking member of the Committee
on Ways and Means for yielding me time.
Mr. Speaker, this bill will not give anybody a diaper rash. It has
nothing to do with diaper rashes and things of that nature. What we saw
was that in January of 2001, we were projecting a $5.6 trillion
surplus. That surplus is almost all gone now because we passed a tax
cut of $1.3 trillion last year, and now we are going to pass a $4
trillion tax cut over the next 20 years. $5.5 trillion in tax cuts.
What is interesting about this tax cut, it will not give baby rashes,
but those people whose tax returns show an average of $500,000 a year,
let me repeat that, $500,000 a year, will get 60 percent of that $5.5
trillion surplus. To put it another way, if your tax return shows over
$1 million a year, you are going to get 40 percent of this $5.5
trillion tax cut.
This is payroll tax money. The people on the elevators, running the
elevators, waitresses in restaurants, this is their money that they
think is going into the Social Security trust account, and instead it
is going to go to pay for tax cuts for those earning $1 million a year
or $500,000 a year.
I have to say that in addition to that, this is going to put a
massive drain on the Social Security trust fund. It will not give baby
rashes, but it is going to do major damage to senior citizens
throughout the United States. $5.5 trillion.
Forty million new Americans are going to go on the Social Security
system in the next 20 years while this tax cut is going through, and we
are going to see, if this tax cut goes through, $5.5 trillion, a 30
percent reduction, a 30 percent reduction in the average American
Social Security benefits.
That is what this is really all about. It is an issue, frankly, of
values, what this country stands for. We want to make sure that we have
clean air, we want to make sure we have education for our children, we
want to make sure that we give our senior citizens the life they are
entitled to in their retirement age.
Mr. RANGEL. Mr. Speaker will the gentleman yield?
Mr. MATSUI. I yield to the gentleman from New York.
Mr. RANGEL. Mr. Speaker, I would like to ask some questions of the
gentleman, because he has made some pretty bold statements out here.
Did not the Republican leadership promise that they would not invade
the Social Security trust fund? Did they not put this in a lock box?
What is the gentleman's response to that?
Mr. MATSUI. Mr. Speaker, reclaiming my time, I would say to the
gentleman from New York that over the last 4 years, we had seven votes
that the Republican leadership put to the floor of the House saying we
were not going to invade the Social Security trust accounts.
Mr. RANGEL. If the gentleman will yield further, what did they do?
Mr. MATSUI. Mr. Speaker, they have raided the Social Security trust
account. They are going to take $5.5 trillion out if this tax cut goes
through, and it is going to have a 30 percent reduction in benefits for
the average Social Security recipient.
Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I repeat my statement: There will be no trust fund
monies spent from Social Security.
To underscore that, it is my pleasure to yield 2 minutes to the
gentleman from Florida (Mr. Shaw), the chairman of the Subcommittee on
Social Security.
Prior to that, I ask unanimous consent to yield the balance of my
time to the gentleman from Missouri (Mr. Hulshof), and that he be
allowed to control said time.
The SPEAKER pro tempore (Mr. Simpson). Is there objection to the
request of the gentleman from California?
There was no objection.
(Mr. SHAW asked and was given permission to revise and extend his
remarks, and include extraneous material.)
Mr. SHAW. Mr. Speaker, I have a prepared statement that I will make
part of the Record, and therefore I want to direct my statements to
really the incredible statement that I just heard on the floor by the
ranking member on the Subcommittee on Social Security and the ranking
member of the Committee on Ways and Means.
Mr. Speaker, I would say to my friends, no one is raiding the Social
Security trust fund. By law you cannot. The only thing in the trust
fund is Treasury Bills. Is anybody saying we are taking Treasury Bills
out of the Social Security trust fund? Of course not.
Let us get a basic knowledge here of honesty and really look into how
this system works. The FICA taxes that are paid, which, incidentally,
are not being cut, so I do not know where that argument came from, that
came really out of left field, goes into the Social Security trust
fund. It goes out by way of payment of benefits. What is not used is a
surplus, which then goes into the general fund and is replaced with
Treasury Bills inside the trust fund.
Now, how in the world do you raid the Social Security trust fund? By
law you cannot. You cannot and never have. When the Democrats were
spending all of the surplus and deficit spending, they did not go into
the trust fund, because you cannot. You cannot go into the trust fund.
I also heard the incredible statement made just a few moments ago
that this is going to lower benefits by 30 percent. Do you know where
that figure comes from? If this Congress does nothing, nothing, to
reform the Social Security system in this country by forward funding
it. That is what the Democrats are talking about. They are not going to
have enough money beginning after somewhere in about 25 or 30 years,
and they will be faced with a situation, the country will be faced with
a situation, of not being able to maintain the amount of benefits that
we have.
My colleagues on the other side of the aisle continue to mislead
American workers and seniors. They claim the Social Security trust
funds are being raided to pay for needed tax relief--in spite of the
facts.
Such myths are intended only to scare seniors, use Social Security as
a political jackhammer, and divert attention from the fact that the
Democratic leadership has no plan for strengthening Social Security.
They are not acting responsibly.
Everybody here knows the Social Security trust funds have no dollars
to ``raid.'' Social Security works the way it always has: surplus
payroll taxes are credited to the trust funds as interest bearing
Treasury bills--that's the law. It is legally impossible to use those
Treasury IOUs for anything else other than paying benefits or
administering the Social Security program.
In the name of Social Security, Democrats opposed to making the tax
cuts permanent are for tax hikes. Yet, saddling hard-working taxpayers
with higher taxes does nothing to stop the enormous cash-flow deficits
Social Security faces due to the aging of our nation. If nothing is
done, Americans will soon face the additional tax burden of supporting
Social Security. While doing nothing appears to be the Democrat
solution, it certainly isn't ours.
Moreover, the numbers just don't add up. The cost of Social
Security's annual cash-flow deficits will continue to grow, well beyond
over-inflated cost estimates of extending tax relief.
And everyone knows adding more government IOUs to the trust fund
doesn't do a single thing for Social Security. Because at the end of
the day, the Treasury still needs to find the cash to pay those debts.
Making the tax cuts permanent will help the economy grow by hundreds
of billions of dollars in the near future, making debt reduction
easier, sustaining productivity growth and improving our ability to
address the needs of the retiring baby-boom. Letting the tax cuts
expire, on the other hand, will cause tax hikes on taxpayers, dampen
economic growth, and erode retirement security. For example, a 35 year
old would set aside over $160,000 less in their IRA at age 65 if the
tax cut is not make permanent.
Rather than talking about how to pass the buck onto future
generations, let's have a full and honest debate about how to keep the
pledge both Republicans and Democrats made last December. In a vote of
415-5 we pledged to save Social Security without cutting
[[Page H1438]]
benefits, without raising taxes, or ignoring the special needs of women
and minorities.
This debate should start with the Democrats' offering their plan to
save Social Security. Are they for massive, growing, and never-ending
general revenue transfers that still leave an unsustainable program?
Are they for Uncle Sam sitting in the corporate boardrooms of America
by allowing government investing of the trust funds or making millions
of workers pay more payroll taxes without giving them credit toward
their benefits, as called for by Mr. DeFazio--who has my sincere
respect for committing his plan to legislation. Where are his Democrat
colleagues?
America's seniors, workers, and their families are counting on us to
provide leadership to strengthen Social Security. If we neglect this
duty, if we play political games using Social Security as a pawn, it is
our kids and grandkids that will pay the price of our shortsightedness.
Mr. RANGEL. Mr. Speaker, so our side will be able to respond to that
question, I yield 2\1/2\ minutes to the gentleman from South Carolina
(Mr. Spratt), the ranking member on the Committee on the Budget, who
has provided an outstanding service to the Congress and the country.
(Mr. SPRATT asked and was given permission to revise and extend his
remarks.)
Mr. SPRATT. Mr. Speaker, the critical vote came first. It was the
vote to bypass the budget and do away with the rules that have served
us well for the last 10 years. They moved the budget out of deep
deficit into big surpluses. Now, with those rules out of the way, this
tax bill can work its will, which is just what the gentleman said, it
is to raid Social Security.
If you do not believe me, look at the President's own budget. The
President's budget calls for $675 billion in tax cuts on top of the
$1.3 trillion passed last June. Among other things, it calls for this
repeal of the sunset provision. As a result, look at the President's
own budget. It wipes out what it is left of any surplus, it spends the
entire Medicare surplus, consumes it completely, and spends two-thirds
of the Social Security surplus, by the President's own accounting.
Last month, when our Republican colleagues in the House brought out
their budget resolution, it provided for none of those tax cuts. Not
any of them. It did not make any mention of repeal of the so-called
sunset in last year's tax bill. Why was that? Because they knew if they
factored into their budget these tax cuts, it would drive the bottom
line through the floor. It would put the budget in deficit for as far
as the eye could see. They would be spending virtually all of Social
Security, the Social Security surplus, and all of the Medicare surplus.
Now, one month later, they bring up a tax cut that they could not
accommodate in their budget resolution, did not want to put in the
context of a budget resolution, because that would have shown what it
did to Social Security, what it did to Medicare. They bring it up ad
hoc, all by itself, a blatant violation of the budget process rules.
Consider this: Last year, the Secretary of the Treasury told us that
we would not need to raise the ceiling on the amount of national debt
we can incur for at least 8 years. That was his testimony. Yesterday
the Secretary of the Treasury sent us his third letter saying that the
ceiling on the national debt needs to be raised, and raised now, by
$750 billion. Why is that? Because we are spending the Social Security
trust account, we are spending the Medicare trust account, and not
using them to pay down the debt of the United States.
So what is the response of our Republican leaders in the House? It is
not to raise the debt ceiling. Their response is to reduce taxes by
another $500 billion between now and 2012, $4 trillion between 2012 and
2022. This will wipe out what is left of Social Security and all of the
surplus that builds up between now and 2012.
Mr. HULSHOF. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would just say in response to the gentleman that the
only budget this House has considered this year does, in fact, include
room to make these tax cuts permanent. In fact, the most recent numbers
from our official scorekeepers, the Congressional Budget Office, as
well as the Joint Tax Committee, tell us this extension would take from
the Treasury $374 billion over 10 years. At the same time, we would
accumulate surpluses of $2.3 trillion.
Mr. Speaker, I yield 2 minutes to the gentleman from New York (Mr.
Houghton), a member of the Committee on Ways and Means.
Mr. HOUGHTON. Mr. Speaker, this is a bill that never should have
happened. If it had not been for quirks in the Senate language, this
all would have been put to bed when we settled the tax reduction issue
last year.
Now, look, this bill is not perfect. I have questions about the
amount of money, I have questions about the timing, I have questions
about the estate tax. But basically it is moving us in the right
direction.
I ask the question, what is wrong with reducing taxes? When I was in
business, many times we made money, and sometimes we did not make
money. But every so often you would say to your employees, gentlemen,
ladies, you have hung with us a long time. We have not given you an
increase. Many times we have had to have layoffs.
{time} 1315
But we are going to give you back some of that money which now we are
generating. I think that is a good idea, and that is what this thing is
all about.
I strongly support this bill.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Georgia (Mr. Lewis), my distinguished friend and member of the
committee.
Mr. LEWIS of Georgia. Mr. Speaker, I thank the gentleman for yielding
me this time.
Mr. SPRATT. Mr. Speaker, will the gentleman yield?
Mr. LEWIS of Georgia. I yield to the gentleman from South Carolina.
Mr. SPRATT. Mr. Speaker, I simply want to point out that the budget
resolution brought to the floor by the House Republicans last month
provided only $77 billion in tax cuts over the next 5 years. The
President is calling for $675 billion in tax cuts over the next 10
years, and the repeal of this repealer will take at least $400 to $500
billion. Their budget resolution did not provide for this tax cut.
Mr. LEWIS of Georgia. Mr. Speaker, I rise in strong opposition to
H.R. 586. This tax cut bill is not the way to go. It does not provide
real relief for all Americans. It is just plain, downright
irresponsible.
I ask my Republican colleagues to reconsider their priorities.
Mr. Speaker, if we make the Republican tax cut permanent, we risk
stealing, taking, really raiding the Social Security trust fund by more
than $4 trillion. We risk gambling the future of the Medicare trust
fund. We jeopardize funding for education and a prescription drug
benefit for our seniors.
This tax cut bill breaks the promise that we made to the American
people to use their tax dollars wisely. A huge windfall for the
wealthy, pocket change for working Americans. We should be taking care
of the basic needs of all of our people, not rushing to pass a tax cut
bill that puts us deeper and deeper in debt.
Today we have a choice, a choice between a permanent tax cut bill
that benefits a few, or Social Security and Medicare security that
benefit all Americans. I urge my colleagues to make the right choice,
the moral choice, the good choice. Vote against this bill.
Mr. HULSHOF. Mr. Speaker, what is irresponsible is forcing upon the
American families and American businesses a tax increase if Congress
does nothing.
Mr. Speaker, I am happy to yield 2 minutes to the gentleman from
Texas (Mr. Sam Johnson).
(Mr. SAM JOHNSON of Texas asked and was given permission to revise
and extend his remarks.)
Mr. SAM JOHNSON of Texas. Mr. Speaker, it is morally irresponsible
not to pass this. Mr. Speaker, I want to thank the gentleman from
California (Mr. Thomas), the chairman of the Committee on Ways and
Means, for bringing this bill to the floor. We have to make the tax
cuts we enacted last year permanent. Hard-working Americans and the
Texans who live in my congressional district were downright angry when
they heard that their taxes would increase in 10 years. They think we
have lost our minds in Washington. Mr. Speaker, I think they are right.
Just think about it for a moment. We decided to repeal the worst
parts of the
[[Page H1439]]
marriage penalty. We all hope and expect marriages to last. Why would
anyone object to the marriage penalty relief becoming permanent? If
they do, they must be in a fight with their spouse.
Why would anyone object to $1,000 child tax credit being permanent?
How can somebody be against giving parents the extra money they need to
raise their children? If my colleagues are against it, I guess they
just do not like children.
On another issue, this Congress took important steps to help
Americans save for their own retirement by increasing the amount people
can contribute to an IRA to $5,000. How can anyone argue against this?
If my colleagues do, it means my colleagues are addicted to government
spending and against personal savings. The only reason for arguing
against these important changes is if my colleagues love big government
and do not like people making their own choices and keeping their own
money.
Mr. Speaker, we need to pass this for the good of America.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Maryland (Mr. Hoyer), a leader in this Congress.
Mr. HOYER. Mr. Speaker, the gentleman from Texas said they must have
been out of their minds. Of course it was his side of the aisle that
included this provision. Remember that, I say to the gentleman, and
tell them that.
Mr. Speaker, we are here today for one reason and one reason only: to
indulge the GOP in its pavlovian policy prescription for every
occasion: tax cuts. The GOP sold its tax cuts last year by telling the
American people they were overcharged. Democrats fought for and are
still for affordable tax relief. But we knew the projected surplus
might never materialize, and we were right.
Mr. Speaker, $5.6 trillion the President said we had; he came down to
us now and says we have $.6 trillion. The President's own budget says
the tax cut was the single biggest factor in erasing our surplus. So is
the GOP here to say they made a mistake, to say, let us stop the raid
on Social Security and Medicare? Of course not.
With deficits projected every year for the next 10 years and an
unchecked raid on Social Security and Medicare, the GOP proposes a bill
that would deplete an estimated $7 trillion from the Social Security
and Medicare trust funds.
I asked Secretary O'Neill that yesterday, whether $4 trillion to $7
trillion was the accurate figure, and he said he thought it probably
was. Just as the baby boomers become of age, to take Social Security,
we are doing this to them.
Mr. Speaker, I urge my colleagues to reject this demagogic, reckless,
irresponsible piece of legislation.
Mr. HULSHOF. Mr. Speaker, it is my privilege to yield 2 minutes to
the gentlewoman from Washington (Ms. Dunn), a Member who has, more than
any other Member, fought to eliminate the Federal death tax.
Ms. DUNN. Mr. Speaker, I stand in strong support of the Tax Relief
Guarantee Act, and I do so on behalf of families and small businesses
all over this great country of ours.
Last year we passed a landmark tax relief bill that reduced income
taxes for all Americans, the first across-the-board rate cut since the
second world war. Now it is time to finish the job.
We have to strip away the sunset provision or else taxpayers will
face a decade of uncertainty. Many economists, including Federal
Reserve Chairman Alan Greenspan, have declared that it is very
important for Congress to act clearly and unequivocally in this area,
because taxpayers need certainty.
Consider the perverse case of the death tax. As the law now stands,
the death tax will be repealed on December 31, 2009; and it will return
on January 1, 2011, at pre-2001 rates, 55 percent, on estates over
$675,000. We are in essence telling people that they have one calendar
year to die, or else their heirs will pay that punishing 55 percent tax
rate. Without permanence, no small business owner or family farmer can
assume the death tax is gone forever. They have to continue to spend
money on expensive life insurance policies and costly estate plans.
A study of women-owned businesses recently found that small
businesswomen spend, on average, $1,000 a month paying to provide for
the death tax. This is money that they could use to hire workers or to
buy new equipment or to provide health care for their employees. It is
important, Mr. Speaker, to understand that the lack of permanence has
real consequences. It is also important to acknowledge that if we do
not support permanence, then we are implicitly supporting a tax
increase on January 1, 2011.
We have an opportunity to correct a mistake, a legacy of the other
body. I think, Mr. Speaker, we ought to seize this moment, fulfill the
promise we made, and the President made, to Americans last spring. Let
us make these tax cuts permanent.
Mr. RANGEL. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from
Wisconsin (Mr. Kleczka), a member of the Committee on Ways and Means.
Request for Motion to Adjourn
Mr. KLECZKA. Mr. Speaker, I move that the House, upon conclusion of
today's business, adjourn until noon, January 1, 2011.
The SPEAKER pro tempore (Mr. Simpson). That motion is not in order at
this time.
Mr. KLECZKA. Well, Mr. Speaker, if it was in order, it would give
some rationale to the bill before the House.
The tax bill, as passed by my colleagues to my left, provided for the
sunset. And the gentlewoman from Washington State just stood up and
said, my friends, here is what happens. If you die in 2011, you are
going to pay an inheritance tax. And if you die in 2009, you will not.
Well, whoever drafted such a nutty bill?
It was they who did so, and it was they who passed it. And it was
signed by the President in June of last year. So now a few months later
to come back and say, my God, the sky is falling, we are hearing from
people who know they are going to die in 2011, and they want it changed
now. And I have not heard from any constituent who knows they are going
to die in 2011.
But I say to my colleagues that we have some other things to talk
about before we restore the permanency to this tax cut. Why are we
doing it? I think I know why.
In November there is going to be a congressional election, and right
now, the poll numbers are showing them guys think they are in trouble.
And if, in fact, the Democrats take back the House, which I think we
will, that bill might not come up. And the new chairman of the
committee, the gentleman from New York (Mr. Rangel), might see to it
that it does not come up right away, because he and I and many other
Democrats are concerned about providing for a drug benefit for the
Medicare program. That is going to cost some money. We are told by the
Secretary of the Treasury that by June of this year, we have to
increase the national debt for all Americans to $6.5 trillion. How can
we do that if we make permanent a tax cut which is questionable to
begin with?
But remember the debate last year. We were awash in a surplus. We
were just swimming in greenbacks here in Congress, so they had a tax
bill that gave the bulk of it back; and this year's budget is back in a
deficit. Let us take care of the needs of the people; let us get out of
deficit before we do something foolhardy, and if I get that call from a
constituent who is going to die in 2011, I want to know how he or she
knows that.
Mr. HULSHOF. Mr. Speaker, I yield 3 seconds to the gentleman from
California (Mr. Thomas), the chairman of the Committee on Ways and
Means.
Mr. THOMAS. Mr. Speaker, just so we stay on this planet in terms of
our rhetoric, six times between March and May, this House passed tax
reduction bills. Every one of them was permanent, including on April 4,
H.R. 8, which repealed the death or estate tax. That was permanent. It
was the United States Senate, and please stop me when I have violated
any rule in talking about the other body, that produced this document
which was the only time the House voted not to make the tax cuts
permanent, and that was a bill generated through a conference. This
House voted to make it permanent, and we are trying to do it again.
Mr. KLECZKA. Mr. Speaker, will the gentleman yield? The fact is he
voted for the conference committee report.
Mr. HULSHOF. Regular order, Mr. Speaker.
[[Page H1440]]
Would the Chair be kind enough to advise each side as to how much
time remains.
The SPEAKER pro tempore. The gentleman from Missouri (Mr. Hulshof)
has 18 minutes remaining; the gentleman from New York (Mr. Rangel) has
18\1/4\ minutes remaining.
Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume
just to respond to my distinguished chairman, since it appears as
though the dog has eaten his homework.
This bill was signed into law by a Republican President after passing
a Republican House of Representatives and passing a Republican Senate
that had had a compromise that excluded all Democrats.
{time} 1330
Mr. Speaker, I yield 2 minutes to the distinguished gentlewoman from
Florida (Mrs. Thurman), an outstanding Member of Congress and of the
committee.
Mrs. THURMAN. Mr. Speaker, I thank the gentleman for yielding time to
me.
Mr. Speaker, I just think this is the wrong bill at the wrong time
for hardworking taxpayers who work hard to make ends meet today and
retire comfortably tomorrow.
Working Americans get little from this bill. They already have
received 70 percent of the tax cut that Congress passed last year: the
10 percent rate, increased child care credit, education incentives, and
higher pension contribution limits.
So what does this bill do for middle America? First, it will bring
even more working Americans under the alternative minimum tax. By 2012,
39 million taxpayers, about one in three, will face AMT liability. This
bill gives a promise with one hand and takes away the promised tax cut
with the other.
This bill increases the deficit by $374 billion over the next 10
years. Every dollar of that added deficit comes from the Social
Security trust funds. That is $374 billion that cannot be used to
reduce the national debt and interest on that debt.
If interest payments were not so large, we would have a chance to
deal with our other priorities: Social Security, a Medicare
prescription drug program, education, or our veterans' programs.
Speaking of veterans, the cost of this bill will be more than three
times as large as the VA budget. Think about it: Every Member has heard
from local veterans who know, as we all know, that the VA budget needs
to be increased, especially for health care. We all have heard of
veterans who cannot get appointments because VA hospitals and clinics
do not have the resources.
Most of us have supported an increase in the VA budget in recent
years. Yet, today we debate giving away future VA increases, and then
some.
In addition, this bill will reduce revenue by $4 trillion in the
period after 2012. People born in 1946 will be 66 years old that year,
retired and using Medicare. Will Medicare be there for them? It may not
if we continue to provide unnecessary tax cuts and eat up the trust
funds.
Mr. Speaker, this is the wrong bill at the wrong time, and it is
wrong for us to leave this increased debt for our children and
grandchildren.
Mr. HULSHOF. Mr. Speaker, it is my honor to yield 2 minutes to the
gentleman from Illinois (Mr. Weller), a valued member of the Committee
on Ways and Means who has fought to eliminate the marriage penalty.
Mr. WELLER. Mr. Speaker, I thank the gentleman from Missouri for his
leadership, and he and the gentleman from Wisconsin (Mr. Ryan) for
their leadership on this permanency legislation, and my chairman for
making this a priority, as well.
Often a question in debate on this floor is who is helped and who is
hurt by the legislation that is on the floor. If Members vote no on
making the Bush tax cut permanent, we will label it the Bush tax cut,
100 million Americans benefit from the Bush tax cut. So if Members vote
no, they are voting to raise taxes on 100 million Americans.
I would note that there are 3.9 million Americans who do not pay
taxes because of the Bush tax cut, 3 million Americans with children do
not pay taxes because of the Bush tax cut. If Members vote no and the
Bush tax cut expires, those 3.9 million low-income taxpayers will once
again have to pay taxes. They are the ones who are hurt.
Let us take a moment to talk about the marriage tax penalty. Under
the Bush tax cut, we eliminated the marriage tax penalty. There are 43
million Americans who paid on average about $1,700 more prior to the
Bush tax cut just because they were married. They combined their
incomes, filed jointly, and they were pushed into a higher tax bracket;
43 million couples, $1,700. We eliminated that with the Bush tax cut.
It is always important, I think, to put a human face on who also
benefits when we eliminate the marriage tax penalty. Let me introduce a
family from Joliet, Illinois, Jose and Magdalene Castillo, their son
Eduardo, and their daughter, Carolina. They suffered the marriage tax
penalty prior to the Bush tax cut, but because of the commitment of the
Republican majority in the House, we eliminated the marriage tax
penalty for two hardworking laborers from Joliet, Illinois, who paid on
average about $1,125 more because of the marriage tax penalty. The Bush
tax cut eliminated the marriage tax penalty.
So the question is, today, are we going to vote to reimpose the
marriage tax penalty on Jose and Magdalene Castillo, or are we going to
protect them? That is what is always interesting.
My Democratic friends will argue passionately for permanent spending
increases, they will argue passionately for permanent tax increases,
but they always oppose making a tax cut permanent.
Let us vote yes. Let us do the right thing. Let us help people like
Jose and Magdalene Castillo of Joliet, Illinois.
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
North Dakota (Mr. Pomeroy), a member of the Committee on Ways and
Means.
Mr. POMEROY. Mr. Speaker, I thank the gentleman for yielding time to
me.
We look back to that brief period of time when Republicans and
Democrats alike came to this floor to pledge that they would protect
Social Security revenues and pledge to protect that lockbox, and
actually compete with one another in terms of who could best protect
those Social Security dollars.
How differently things are right now. The majority never came to this
floor and said, all bets are off. We are going to grab the Social
Security cash to fund the government because we are going to cut the
rest of the revenues of this country, but that is exactly what is at
stake. They are shortchanging the Social Security revenues that we will
need to fund the Social Security program by passing this measure. In
doing that, they are leaving a much bigger burden for our children.
None of the families I represent are preparing for their retirement
costs by just doing no planning at all, spending freely, and relying
entirely on the children, their children, to carry the day. Why should
we then, as a country, steer our national budget in a way that blows
the revenues now and relies upon our children to make up the
difference?
There will never be a retirement switch demographically quite like
the baby-boomers moving into retirement. The first will turn 65 in the
year 2011. What in the world can we be thinking about to propose
devastating the Federal budget at the very time the boomers are fully
drawing Social Security, fully drawing Medicare?
The only thing that can explain this is this is the baby-boomers'
last great self-indulgent act: Blow the revenue now, leave the kids to
pick up the slack. That is not how our families function and that is
not, as a nation, how we should function.
Mr. HULSHOF. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would say to the gentleman that I am confident that
there are family farmers and small businesses in North Dakota that are
trying to plan to pass those businesses on to their next generation,
and yet cannot because of the sunset, which we are trying to repeal.
Mr. Speaker, especially on the pension issue, no one has been a
better champion on our side of the aisle than the gentleman from Ohio.
Mr. Speaker, I am pleased to yield 2 minutes to the gentleman from
Ohio (Mr. Portman).
Mr. PORTMAN. Mr. Speaker, I thank my colleague for yielding time to
me, and I want to congratulate the gentleman from Wisconsin (Mr. Ryan)
and
[[Page H1441]]
the gentleman from Missouri (Mr. Hulshof) for bringing this bill to the
floor. All we are doing is reaffirming what this House did last spring.
I suppose it is going to be tough for some of my colleagues on the
other side of the aisle who did not join some of their colleagues,
because it was a bipartisan vote last spring, to change their vote and
now support tax relief. But they ought to think about it, for a couple
of reasons.
First, what do we know since last spring? We know these tax cuts were
extremely important in keeping us out of a deep recession, and now
helping this economy to grow. Economists right, left, and center,
including the chairman of the Federal Reserve, have said that: low
inflation, low interest rates, lower taxes.
So if they are interested in getting us back into a surplus position
so we can take care of the needs of our seniors through Social Security
and Medicare, I would think they would want to think again about maybe
supporting this tax relief.
Second, even though we have passed a good bill out of the House, the
Senate put this 10-year limit on it. That does not make any sense. Why
would we want to have tax relief only last for 10 years? We cannot
plan. The whole idea with taxes is to be able to plan. Otherwise, we
have a huge cost to the economy, to people, to businesses. Not being
able to plan means incredibly increased costs and incredible new
complexity.
Think about it. If somebody is trying to plan what they are going to
do, their accountants and planners are going to say, well, in the ninth
year this thing ends and in the tenth year it starts up again, so we
really cannot give you any advice about planning, so you have to plan
for both. That is a terrible inefficiency in the economy.
I would hope my colleagues would think about that. I will just give
one example.
The gentleman from Missouri (Mr. Hulshof) mentioned the retirement
security provisions. They were very popular on a bipartisan basis
because they make a lot of sense. They simplify the plans so the small
businesses can get into them. They let people take the plan from job to
job. They let people save more for their retirement. This year, people
can save 50 percent more for their IRA, in their 401(k). If you are
over 50, you can save even more.
This is great stuff. Do we want this to expire in 9 years? This does
not make any sense. Let us not pull out the rug from the American
people. Let us support this permanence.
Mr. RANGEL. I yield myself such time as I may consume, Mr. Speaker.
Sir, this stupid 10-year limitation was passed by the Republican
Senate, came back here, and was passed by the House, the Republicans,
and went to our President and he signed it. So I would tell the
gentleman to be careful what he calls stupid when he voted for it.
Mr. Speaker, I yield 2 minutes to the gentleman from Texas (Mr.
Doggett), a distinguished member of the Committee on Ways and Means.
Mr. DOGGETT. Mr. Speaker, I thank the gentleman for yielding time to
me.
Mr. Speaker, Many people have said that 9/11 changed everything for
this country. It certainly did for President Bush and his budget. He is
now urging this Congress to increase the size of Federal spending by 22
percent for this coming year, over what it was in 1999.
This is the largest increase in Federal spending over that period of
time than any comparable time since another Texan named Lyndon Johnson
was President. Somehow 9/11 has changed nothing in what is always the
predominant theme of the House Republican leadership and their agenda:
convincing voters that they can have something for nothing. They are
out to convince folks that every year they can pay less and less. Even
if we have new, essential security requirements and other government
needs, they will just continue to ``borrow and spend''--their
traditional policy.
The Republicans that were once known as the ``party of fiscal
responsibility'' are now known as the ``party of shifting
responsibility'', letting tomorrow's children pay for today's needs.
It was not long ago that the Republicans were bringing the debt clock
out here to the House floor to show us the impact of the national debt.
It kept going up. It reminded me of that old ad about a watch: ``It
takes a licking and it keeps on ticking.'' Well, it is ticking now as a
result of the licking that it is taking with this economy and with the
increased spending being proposed.
If there was a problem with the ``guns-and-butter'' budget of the
sixties, imagine the extent of the problem we are going to have with
what is essentially a ``guns-and-caviar'' approach: unlimited defense
spending and tax cuts for the caviar set. At the very time this takes
effect, many Americans who are baby boomers are going to be retiring.
They will need their Social Security. They will need their Medicare.
They will have other needs of an aging population even as we have fewer
workers to finance those needs. Yet, they propose more debt instead of
more responsibility.
Reject the fiscal folly: reject this ``gimmick for the gullible.''
Mr. HULSHOF. Mr. Speaker, I yield myself such time as I may consume.
I would remind the gentleman from Texas, Mr. Speaker, that Social
Security and Medicare are funded with payroll taxes, not income taxes.
Mr. Speaker, it is my privilege to yield 2 minutes to the gentleman
from Arizona (Mr. Hayworth), another valued member of the Committee on
Ways and Means.
(Mr. HAYWORTH asked and was given permission to revise and extend his
remarks.)
Mr. HAYWORTH. Mr. Speaker, I thank my colleague from Missouri for
yielding time to me.
I listened with great interest to my friend, the gentleman from Texas
(Mr. Doggett). Mr. Speaker, it is something to see a change in
political parties. It is something when we stop and realize that the
standardbearer of the once proud Democratic Party said the only thing
we have to fear is fear itself, and now, sadly, from the modern
Democratic Party, the only thing they have to offer is fear itself.
Courage and commitment should be bipartisan, or really should be
nonpartisan. Indeed, if we take a look at history over the last 40
years, it was first a Democratic President, John F. Kennedy, who said
we should reduce marginal tax rates because a rising tide lifts all the
boats. Ronald Reagan followed with a similar philosophy in 1980, as did
George W. Bush last year.
And guess what? Revenues to the government long-term actually
increased because people have more of their money to save, spend, and
invest.
My friends on the left have been here really captive to a debate of
process. What we should talk about, Mr. Speaker, is a debate based on
principles and priorities involving real people.
This is the real consequence if Members vote no today on permanency
for tax cuts: A single mother, hear me, not the caviar crew, not the
Cadillac set, a single mother will end up paying an additional $963 of
her hard-earned money in higher taxes if they say no to making the tax
cut permanent.
Now, I know we have been talking about millions and trillions and
billions, but a thousand dollars is important in the family budget. Do
Members really, Mr. Speaker, want to see taxes raised on working
Americans? And yet, that is the net effect if Members do not join with
us in a bipartisan, nay, in a nonpartisan fashion, and vote to enact
permanent tax cuts. Vote yes.
{time} 1345
Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from
Massachusetts (Mr. Neal), a member of the Committee on Ways and Means.
Mr. NEAL of Massachusetts. Mr. Speaker, I thank the gentleman from
New York (Mr. Rangel) very much for yielding me the time.
The previous speaker from Ohio said we are asked to reconfirm what we
had done last spring. That is astounding in light of the fact that we
are also asked since 9-11 to spend $4 billion more on defense, $38
billion more on homeland security, and protect tax cuts. For him to say
that we are only doing what we did last spring, as though nothing
happened on 9-11, just do what we did last spring, is astounding.
Here we are on the heels of the annual tax filing season to once
again to say to the American people we appreciate your contributions
for military defense, for homeland security, for health care for
elderly and the poor and our veterans, and to also argue on behalf of
fiscal discipline. Last year, Congress learned quickly these cuts in
[[Page H1442]]
tax would lead to big deficits. Trillions of dollars in surplus
overnight vanished, and the American taxpayer wondered what happened to
that money.
The Republican amendment today is fraudulent and everybody knows it.
They are playing a game of three card monty. When they are in charge,
they will always draw the tax cut card, but when the average middle-
income taxpayer is involved, they will find simply they are going to
pay the bill. No matter how many times they play, middle-income
taxpayers will get stuck with alternative minimum tax, and this bill
does nothing about it.
The Bush administration indicated that because of the alternative
minimum tax we will see a massive increase in the number of affected
families reaching 39 million by 2012, a full one-third of taxpayers
with a liability. At the beginning of this week, Mr. Speaker,
Republican leaders and the Treasury Department held press conferences
to talk about how badly the current Tax Code needs to be simplified;
and by the end of this week, we are voting to eliminate any possibility
of getting it done, and we are being pushed into further debt.
We heard speeches years ago against fiscal discipline. One leader in
the Republican Party said we are having a fiscal Armageddon. Another
one said what a disaster. We had 8 years of unparalleled economic
prosperity before this Administration. Vote against this fraudulent
measure and for fiscal integrity.
Mr. HULSHOF. Mr. Speaker, may I inquire as to the time remaining on
each side.
The SPEAKER pro tempore (Mr. Simpson). The gentleman from Missouri
(Mr. Hulshof) has 11\3/4\ minutes remaining, and the gentleman from New
York (Mr. Rangel) has 9\1/4\ minutes remaining.
Mr. HULSHOF. Mr. Speaker, it is my honor to yield 2 minutes to the
gentleman from Texas (Mr. DeLay), the majority whip.
Mr. DeLAY. Mr. Speaker, I thank the gentleman from Missouri for
yielding me the time.
Mr. Speaker, I think it says it all when the gentleman from Texas
previous to me said that tax cuts are a spending program. Only
Democrats would think that tax cuts, leaving money in people's pocket,
is a spending program.
Well, Mr. Speaker, a vote against this bill is a decision to bury the
middle class beneath a wave of new taxes at the end of the decade; and
if the Democrats vote no today, they are inflicting a rash of higher
taxes on the American family.
They will slice the child care tax credit in half. It falls from
$1,000 down to $500 without permanent tax relief.
They will revive the discriminatory marriage penalty that punishes
families with a greater burden.
They will resuscitate the hated death tax that has been stalking
American farmers and small businesswomen all these years.
They will weaken the retirement security of millions of Americans by
slashing the level of contributions to 401(k) plans by more than a
third, and they are dropping IRA contributions from $5,000 down to a
paltry $2,000.
Democrats who vote ``no'' are really saying yes to the largest
single-day tax increase in American history. That is the wrong message
for American families. It heaps uncertainty on farmers and small
businesses, and it sows doubt and uncertainty about our commitment to
fiscal discipline and the prospects for limited government. That is the
wrong path.
We need to reject this tax hike by making the President's tax cuts
permanent; and if we do, average Americans will reap a number of
powerful economic benefits. Married couples will send $1,700 less to
the IRS. Families with kids will pay $1,500 less in taxes. Single moms
will keep more than $700, and our senior citizens will see almost
$1,000 in additional savings in their tax.
All of these steps are positive in their own right; but taken
altogether, they will send a powerful economic signal that will
encourage growth and job creation and, yes, provide more revenues to
the government. So in this way, we will prove to the American people
that we believe they should keep more of the hard-earned money that
they earned.
That is the right message for America. It is what the President wants
and I ask our Members to vote ``yes.''
Mr. RANGEL. Mr. Speaker, I yield myself 1\1/2\ minutes to then yield
to the gentleman from Texas (Mr. DeLay), the majority leader, to ask a
couple of questions here since he was in charge of this bill and did
not make it permanent before. I would like to yield time to him. No one
else is responding. I would like to yield 30 seconds to him.
Mr. DeLAY. Mr. Speaker, will the gentleman yield?
Mr. RANGEL. I yield to the gentleman from Texas.
Mr. DeLAY. Mr. Speaker, I will take the 30 seconds, and I appreciate
the 30 seconds; but I am not the leader. I am the whip.
Mr. RANGEL. Mr. Speaker, the gentleman is the leader. He is the
leader.
Now, did not the Republican-controlled other body put in this 10-year
limitation?
Mr. DeLAY. Mr. Speaker, only in response to the Byrd rule. That is
the rule. If the gentleman is going to yield, let me answer the
question.
Mr. RANGEL. The answer is yes.
Mr. DeLAY. Mr. Speaker, no. Would the gentleman yield so I can
answer?
Mr. RANGEL. Then the answer is no. Is it yes or no, did they do it?
The SPEAKER pro tempore. The gentleman from New York controls time.
Mr. DeLAY. Mr. Speaker, will the gentleman yield?
Mr. RANGEL. I yield to the gentleman from Texas.
Mr. DeLAY. Mr. Speaker, we opposed that because it was a response to
a silly rule over in the Senate called the Byrd rule that does not
allow us to make taxes permanent, yes.
Mr. RANGEL. Mr. Speaker, now did not this silly rule that the silly
Republicans have on the other side--
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore. The gentleman will suspend momentarily.
Members are reminded not to characterize members of the Senate or
Senate rules.
Mr. RANGEL. Mr. Speaker, would the gentleman withdraw calling the
Republicans silly on the other side of the aisle because it is against
the House rules?
Having said that, whatever it was that came over, did not the
Republicans have a conference that excluded Democrats where you
accepted it?
Mr. DeLAY. Mr. Speaker, will the gentleman yield?
Mr. RANGEL. I yield to the gentleman from Texas.
Mr. DeLAY. Mr. Speaker, absolutely not. We did not exclude anybody
from any of the process; and the gentleman may characterize it as that,
but we passed a good tax cut for the American people the best way we
could with the Democrat opposition that we faced.
Mr. RANGEL. The answers are terrific. Did you not vote for a bill
that included this silly amendment?
Mr. DeLAY. Mr. Speaker, will the gentleman yield?
Mr. RANGEL. I yield to the gentleman from Texas.
Mr. DeLAY. Mr. Speaker, I voted for the bill because it was the only
way we could get tax cuts for American families with the Democrat
opposition that we faced.
Mr. RANGEL. Mr. Speaker, did not the President of the United States
sign the bill with this silly amendment that came from the Republican-
controlled Senate?
Mr. DeLAY. Mr. Speaker, will the gentleman yield?
Mr. RANGEL. I yield to the gentleman from Texas.
Mr. DeLAY. Mr. Speaker, certainly the President signed the only tax
cut we could get for the American family in the face of the Democrat
opposition that we faced.
Mr. RANGEL. Mr. Speaker, so I would just like to know where all this
silliness came from and where it emanated and where it finally
concluded. I thank the gentleman for his responses.
Mr. Speaker, I yield \1/2\ minute to the gentleman from California
(Mr. Becerra), a member of the committee.
Mr. BECERRA. Mr. Speaker, I thank the gentleman for yielding me the
time.
Let me make sure we have this straight. The bill that we have before
us is to correct something that our friends on the Republican side did
a year ago when we passed the tax bill that cost about $1.3 trillion,
but when we cost it out a lot more than that because they did not want
to show the
[[Page H1443]]
American people how much it really would cost. Now we are seeing.
In the decade from 2012 forward for those 10 years, it is about
another $4 trillion. What does that translate to, because $4 trillion
is something none of us will ever see. Come 2010, my colleagues can
expect that the top 1 percent of Americans, the richest Americans, will
get about an average of $53,000 in a tax cut; and 60 percent of
Americans will average about $347 in 2010 from that tax cut.
What does that mean? Well, somehow we have to pay for it. How do we
pay for it? We take every single cent out of the Medicare trust fund.
We take every single cent out of the Social Security trust fund, and
all that surplus money, and we spend it to pay for this tax cut.
How do we do that? We did it back in the 80s. We did it with this. It
made very good use of this card. It was one of those we cannot pay now,
but we will pay later. And who pays? I have got three daughters. They
will be paying this credit card. Who else pays? If someone has some
kids, that is who will be paying.
Why are we doing this? We should be the stewards of the people's
money. We are in the people's House, and it is our responsibility to be
responsible stewards of the people's money which they put into Social
Security, which they put into Medicare. And what are we doing? At a
time when we know we are already in deficit, we are going to go further
into it.
This is not the thing to do. Do what any American house would do, and
that is, be responsible with their money, plan for the future for their
kids and retirement. Let us not pass this bill.
Mr. HULSHOF. Mr. Speaker, it is my privilege to yield 2 minutes to
the gentleman from Texas (Mr. Armey), the majority leader of the House.
Mr. ARMEY. Mr. Speaker, I thank the gentleman from Missouri for
yielding me the time.
Mr. Speaker, it is such a privilege and such a pleasure to be here
today. The President of the United States is George W. Bush, achieved
his reduction in taxes for the American working man and woman earlier
in his Presidency than any President that I can ever remember. It was a
good thing what we were able to accomplish with the President, and to
do it so early was particularly rewarding.
There was a hitch in the process when we tried to bring that bill
through because of an arcane rule of the Senate, the other body,
requiring a vote of 60 Senators for permanent tax reduction; and
because we could not acquire 60 votes for permanent tax reduction, we
were forced to accept a 10-year sunset on the Tax Code.
Today, we are here to address that and to renew our commitment to the
American people. So for those young couples that got married and are
enjoying the fact that they are not receiving today prejudice in the
Tax Code for their act of marriage, we are here to say you do not want
to have to sunset your marriage or suffer perverse tax penalties in 10
years. We want to make it permanent in your life, till death do you
part. Permanent surcease from prejudice in the Tax Code.
For those people that worked hard all their life and said I want to
struggle and build and create something and when my days on this Earth
are over leave it to my children that I love so much, we want to say
for the rest of your life, not just for the next 10 years. You do not
have to time your death in accordance with the rules of the other body,
and so on down the line.
So we are asking all our colleagues, do the same rational thing. Vote
for permanent tax relief, a Tax Code that prevails on the American
people today that it be permanent.
In addition to that, we are doing a good thing for those families
that reach out and adopt children. We are giving them a special
consideration in the Tax Code and a special dispensation, some relief
from the burden of taxation as they bring those precious babies into
their homes and make a home for them. A good thing to do.
Finally Mr. Speaker, pursuant to a study that I asked for from GAO
just the last week revealed 2 million American taxpayers, half of whom
had the benefit of professional tax preparation, and were still so
intimidated by the rules of the Tax Code and the enforcement procedures
of the IRS that they did not take fully all of their tax deductions, to
the tune of $1 million in tax overpayment. We are in this bill again
addressing the question of our rights to due process, fair decent
treatment under the Tax Code.
Three good things we do with this bill. I thank the committee. It is
not often that we can come to the floor of the House and with one vote
do three good things for the American people. I hope all my colleagues,
especially those on the other side of the aisle who so often miss these
opportunities, will today avail themselves of the opportunity, do the
right thing, three good things for one vote.
You will never get a bargain like that often in our life. Take the
opportunity today. You will feel better for it.
Mr. RANGEL. Mr. Speaker, I yield such time as he may consume to the
gentleman from Mississippi (Mr. Taylor).
(Mr. TAYLOR of Mississippi asked and was given permission to revise
and extend his remarks, and include extraneous material.)
Mr. TAYLOR of Mississippi. Mr. Speaker, I include for the Record this
statement of the public debt that shows that our Nation's debt has
increased by $232,291,656,313.85 since the passage of this measure 12
months ago. Our Nation now has a record $6 trillion debt for which we
squander $1 billion a day on interest.
Simple Truths About the Budget and the Debt
Updated Through March, 2002 Monthly Statement of the Public Debt and
February, 2002 Monthly Treasury Statement
The Federal debt is still growing. At the close of business
on March 31, 2002, the total public debt was
$6,006,031,606,265.38, or $6.006 trillion. The public debt
increased by $232 billion in the twelve months since March
31, 2002.
Of the $6 trillion debt, $2.55 trillion is owed to various
federal trust funds. These funds were collected and earmarked
for specific purposes, but all their surpluses have been
borrowed and spent in exchange for government securities.
There is no surplus except in trust funds. Through five
months of Fiscal Year 2002, federal trust funds accumulated a
total of $82.2 billion in surpluses, while non-trust fund
accounts ran a deficit of $156.6 billion. For Fiscal Year
2001, which ended in September, trust funds had $224 billion
in surpluses. Outside the trust funds, the federal government
ran a deficit of $97 billion.
The trust fund surpluses are obligated for future benefits.
Most of the surplus funds are collected for Social Security,
Medicare, military retirement, federal employee retirement,
and unemployment benefits to save and invest to pay future
obligations.
We spend a billion dollars per day on interest. In the
first five months of Fiscal Year 2002, the Treasury spent
$150.4 billion on interests in 151 days. Over the same
period, military spending totaled $129.9 billion, $20.5
billion less than interest costs. Medicare spending totaled
$101.4 billion, $49 billion less than interest costs.
In Fiscal Year 2001, the Treasury spent $359.5 billion on
interest on the debt, an average of almost one billion
dollars per day. In the same twelve months, military spending
totaled $291 billion, $68.5 billion less than gross interest.
Medicare spending totaled $241.4 billion, $118 billion less
than gross interest.
Debt Increase in past 12 months
Total Public Debt Outstanding March 31, 2002;
$6,006,031,606,265.38. Total Public Debt Outstanding March
31, 2001: $5,773,739,949,951.53. Increase in Public Debt
Outstanding in 12 months: $232,291,656,313.85.
DEBT OWED TO TRUST FUNDS
------------------------------------------------------------------------
------------------------------------------------------------------------
Total Owed to All Government Accounts..... $2.546 trillion
Total Owed to Social Security Trust Funds. $1.24 trillion
Old-Age and Survivors Insurance........... $1.097 trillion
Disability Insurance...................... $144.7 billion
Total Owed to Medicare Trust Funds........ $257.0 billion
Hospital Insurance (Part A)............... $214.2 billion
Supplementary Medical Insurance (Part B).. $42.8 billion
Military Retirement....................... $156.0 billion
Civil Service Retirement and Disability... $529.8 billion
Unemployment Trust Fund................... $75.9 billion
------------------------------------------------------------------------
Source: Monthly Statement of the Public Debt, March 2002.
Mr. RANGEL. Mr. Speaker, I yield 30 seconds to the gentleman from
Washington (Mr. Inslee).
(Mr. INSLEE asked and was given permission to revise and extend his
remarks.)
{time} 1400
Mr. INSLEE. Mr. Speaker, the Arthur Andersen accountants are really
confused today. For the last several weeks, they have been listening to
the Republican Party trooping in front of the television cameras and
calling them irresponsible, reckless and fiscally negligent. The
Republican leadership then comes to the floor today and
[[Page H1444]]
proposes a bill that will blow a trillion dollar hole in Social
Security below the water line, ensure deficits for decades; and they
call the Arthur Andersen accountants irresponsible?
Mr. Speaker, the Republican leadership is on a course to do to Social
Security and Medicare and fiscal responsibility what Ken Lay and Arthur
Andersen did with Enron. We ought to reject it.
Mr. HULSHOF. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, in brief response, I would remind the gentleman, as I
know the gentleman was not here during part of the debate, that the 10-
year cost for the tax cut that is being considered is $374 billion, and
the most recent Congressional Budget Office numbers project a $2.3
trillion surplus over that period of time.
Mr. Speaker, I yield 2 minutes to the gentleman from Florida (Mr.
Foley).
Mr. FOLEY. Mr. Speaker, I am humored somewhat by the debate today.
There seems to be a lot of hand wringing and shock and outrage over the
deficit. It reminds me of a cross between the pit bull and a collie: It
rips a person's arm off, and then it runs for help.
What we have heard from the other side, 40 years of managing this
process, of running up untold debt, placing it on the back of
taxpayers, watching Social Security become insolvent, and all of a
sudden we hear all of this outrage. When we have debates on
appropriations, I do not hear the same kind of a conservative approach
from the other side of the aisle in holding down spending.
April 15 just passed. I am hopeful that everybody on both sides of
the aisle concluded their tax return. If Members are so outraged with
the tax cut, they could have easily used the old numbers from the old
charts. When we handed out the $500 or $600 checks to individuals, $300
checks, I did not see this rush of Members from the other side of the
aisle coming to hand their checks back to the Treasury.
The American hard-working taxpayers, police officers, teachers,
nurses, doctors, lawyers, janitors, have benefited from this tax policy
that we have initiated. Americans are getting to spend more money on
their kids. People are talking about buying a new washer-dryer, or get
to go on vacation. The appetite for spending in this process is
unbelievable. If they hold up numbers of debt, let us talk about how it
originated. Let us talk about the spending. Let us bring that into the
debate. We cannot talk about doing it as the American family would do,
because if we used that analogy, the neighbors would be being robbed by
us because we would have encouraged them to take something that is not
theirs, use it for someone else, and call it fairness.
This bill on the floor today gives every American a chance to project
over their time how they will deal with their finances. It is certain,
it is important, and it is fair.
Mr. RANGEL. Mr. Speaker, I yield such time as he may consume to the
gentleman from Vermont (Mr. Sanders).
Mr. SANDERS. Mr. Speaker, I rise in opposition to this bill. We
should not be borrowing trillions from Social Security to give huge tax
breaks to the wealthiest 1 percent, and then have inadequate funding
for education, prescription drugs, and veterans' needs.
Mr. Speaker, it may make sense to some people to borrow trillions of
dollars from Social Security in order to give tax breaks to
millionaires. It may make sense to some to raise the $6 trillion dollar
National debt for our kids and grand kids, and increase the deficit--
and then have inadequate funding for education, veterans' needs,
prescription drugs, environmental protection, and other important
social needs.
It does not make sense to me and poll after poll shows that it does
not make sense to the American people.
Let's be honest. This bill has nothing to do with good social policy.
It has everything to do with rewarding the rich folks who have
contributed hundreds of millions to the Republican Party. Thirty eight
percent of the benefits in this proposal would go to the richest one
percent--people who have a minimum income of $375,000 a year.
Tax breaks for millionaires, inadequate funding for veterans, the
elderly, the kids. That's what this bill is about. It is an outrage.
Let's vote ``no.''
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from
Louisiana (Mr. Jefferson).
Mr. JEFFERSON. Mr. Speaker, making this $1.35 trillion tax cut
permanent is bad policy, bad for the economy, bad for the American
people, and it is bad timing. This bill is not about tax cuts, it is
priorities. Not Democratic or Republican priorities, but the priorities
of the American people. Members favor tax cuts. The American taxpayers
favor tax cuts, but our job in Congress is to enact sensible and
affordable tax cuts. We should repeal the AMT because it is a stealth
tax increase on millions of unsuspecting Americans. Many of us believe
we should enact business tax cuts like depreciation reform to stimulate
the economy.
Mr. Speaker, in good conscience, how can we support legislation that
robs Congress of the resources today that we all know are needed to
keep our promises to the American people.
Just last year, a $5 trillion surplus made everything seem possible.
But even with then, with that rosy scenario, Congress knew it could not
see clear to afford permanent tax cuts. That is why it sunset them in
the first place. What has changed in a year? Everything, and none of it
argues for making tax cuts permanent.
Mr. Speaker, if we pass these tax cuts, we are making a big mistake.
It is plain wrong for our economy and for the American people. It is
terrible timing. Oppose this legislation.
Mr. HULSHOF. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman
from Wisconsin (Mr. Ryan), and I am reminded that in America,
pessimists are seldom prophets, and the gentleman is an optimist, and a
cosponsor of this bill.
Mr. RYAN of Wisconsin. Mr. Speaker, I would like to thank the
gentleman for his leadership on this issue. The reason we introduced
this bill, to reverse this arcane Senate rule that caused this problem,
was to give the American taxpayer certainty so they know how to plan
for the future, and to strike a blow for fairness and justice.
This issue, contrary to what we are hearing from the Democrats, is
not an attempt to get another tax cut. We are not raising taxes, we are
not cutting taxes, we are trying to keep taxes steady. If we do not
pass this repeal of the sunset, we are raising taxes. Specifically, a
family of 4 earning $36,268 will have their taxes raised in 2011 by
$2,035; a family of 4 earning $46,756 will have their taxes go up in 1
year by $3,856; a family of 4 earning almost $85,000 will see a tax
bill on January 1, 2011, of $8,000.
Mr. Speaker, I do not think Members realize the magnitude of the
moment that is coming if we do not repeal this sunset. What will happen
from New Year's Eve to New Year's Day, December 31, 2010, to January 1,
2011, will be this: The IRA contribution limit from New Year's Eve to
New Year's Day will go from $5,000 down to $2,000; on New Year's Eve to
New Year's Day that year, the education IRA will go from $2,000 down to
$500; on New Year's Eve to New Year's Day in that year, the 401(k)
limit plans will be cut from a $15,000 cap to $10,500. Every 401(k)
plan in America will have to be cut by a third on that day in 2011.
Mr. Speaker, the death tax on December 31, 2010, will be zero
percent; the next day it will be 55 percent beginning on estates over
$675,000.
Income taxes: Small businesses right now pay a higher income tax rate
than the largest corporations of America. Their taxes will be 35
percent on New Year's Eve; the next day, 39.6 percent, larger than the
taxes paid by IBM or Chrysler or any large operation.
The child tax credit will go from $1,000 down to $500, and the
marriage tax penalty will come back to haunt us. That is what awaits us
on New Year's Day, January 1, 2011, if we do not repeal this arcane
Senate rule sunset. This is a major tax increase if we do not act
today.
Mr. RANGEL. Mr. Speaker, I yield 30 seconds to the gentleman from
Massachusetts (Mr. Markey).
Mr. MARKEY. Mr. Speaker, it was nonsense last June when President
Bush and the Republicans argued that we could have a $1.5 trillion tax
cuts and not raid Social Security and Medicare and Medicaid. It is
nonsense on stilts after September 11, after the deficits, after all
that has happened, that they now want to permanently extend those tax
breaks for the wealthiest 2 percent because they are now going to
[[Page H1445]]
permanently raid Medicare, permanently raid Social Security,
permanently raid Medicaid, which provides nursing home care for every
person in America with Alzheimer's. This is a shameful day in the
history of this country when such a vote can be taken.
Mr. HULSHOF. Mr. Speaker, I yield 2 minutes to the gentleman from
Oklahoma (Mr. Watts).
Mr. WATTS of Oklahoma. Mr. Speaker, I think we have to understand
when proceeding in this debate, there is a difference in philosophies
that is driving this debate. One, the Democrats believe in creating
more taxes; Republicans believe in creating more taxpayers.
When we give Americans more money to spend, to put food on the table,
to help pay the car insurance, that is good for jobs. It is good for
the economy, and it is good for creating more taxpayers. Let us look at
the bottom line and forget all of the goop that we have heard over the
last 2 hours.
The bottom line is that the Democrat leaders' plan for married
couples is to raise taxes by reinstating the marriage tax penalty in
2001. The President's bipartisan plan that got 28 Democratic votes in
the House will give couples $1,700 more per year to spend on themselves
and their kids. The bottom line for families with kids, raise taxes by
the Democrats, repealing the President's child tax credit in 2011. The
bipartisan plan that the President proposed that we passed, cuts taxes
by $1,500 for families every year.
The Democrats' plan for singles, the leadership's plan says in 1993
they raised taxes on Social Security. The President's bipartisan plan,
we give seniors $920 more to spend for themselves.
The bottom line on education IRA, Democrat leaders' plan, raise taxes
by reinstating tax on contributions to education IRA over $500. The
President's bipartisan plan, that got 28 votes of Democrats in the
House, it eliminates taxes on contributions up to $2,000. That is a
good thing for people saving for their children's education.
The bottom line on child care, the Democrat leaders' plan raises
taxes by $770 for single moms in 2011. The President's plan, the
bipartisan plan that got 28 Democrat votes, cuts taxes by $770 for
single moms.
The bottom line for low income families, the Democrat leaders' plan
raises taxes for 3.9 million low-income families. The President's
bipartisan plan eliminates 3.9 million people. Give Americans a fiscal
break. Vote for the President's plan to eliminate higher taxes on the
American people.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentlewoman from
California (Ms. Pelosi), the minority whip.
Ms. PELOSI. Mr. Speaker, I rise in opposition to the Republican raid
on Social Security that is being made on the floor of the House today.
If we support Social Security as we know it today, which are benefits
for America's retiring citizens, Members must vote no on this plan to
make these tax breaks permanent.
Earlier today our body had the opportunity to vote for a resolution
put forth by the gentleman from Illinois (Mr. Phelps). It said that
these tax cuts could go forward and be made permanent if the
Congressional Budget Office certified that no Social Security funds
will be used to cover them. Every Republican voted against that. Every
Democrat voted for it. One has to wonder where all of the Republican
deficit hawks have gone. It seems that they have become an endangered
species.
I think it is very, very important to note that the only way to
reconcile what the Republicans are doing is that they want the surplus
to be reduced, and they want to change Social Security. They want to
exact the huge cuts in benefits that President Bush's commission calls
for that. That is the only way it would add up. I urge my colleagues to
vote no.
{time} 1415
Mr. RANGEL. Mr. Speaker, I yield 30 seconds to the gentleman from New
York (Mr. Crowley).
Mr. CROWLEY. Mr. Speaker, bananaramma, Rubik's Cube, leg warmers,
``Miami Vice,'' and a tax cut for the rich.
The Republican Party wants to go back to the future to 1981 and
President Reagan's voodoo economics. And who is directing this remake?
The House Republicans and this administration.
In just 1 year, this tax cut we have seen has virtually raided all of
the Social Security and Medicare trust funds to provide for huge tax
cuts to wealthy oilmen and other millionaires throughout this country.
At the same time we have seen that Congress can no longer protect
Social Security and the Medicare trust funds from bankruptcy because we
need to pay for this Republican tax scheme somehow.
I ask the American people to stay home and not buy a ticket to this
show. It is a flop and it is a sham.
Mr. RANGEL. Mr. Speaker, I yield 1 minute to the gentleman from New
Jersey (Mr. Menendez), an outstanding leader of our party.
Mr. MENENDEZ. Mr. Speaker, I thank the gentleman for yielding time.
The Bush tax cut is really a tax increase on seniors and on lower-
and middle-income Americans because, for the wealthiest 1 percent to
get a huge tax cut today, working Americans and retirees are going to
end up paying back the debt tomorrow. It is like the Republicans giving
a huge credit line increase to the wealthiest 1 percent who then rack
up astronomical credit card bills, with working families and cash-
strapped retirees being stuck paying the tab at a later date. That is
not smart. That is not fair. That is not fiscally responsible.
We Democrats want a tax cut, but we want a tax cut that benefits
working families and that does not bust the budget or raid Social
Security to pay for it. The fact is after 8 years of fiscal
responsibility and economic growth under a Democratic administration,
it took Republicans less than 1 year to bring us back into long-term
deficit spending. Making that reality permanent is not a good idea.
Let us defeat this tax on retirees and working families and defeat
this unwise raid of Social Security.
Mr. RANGEL. Mr. Speaker, I yield the balance of my time to close this
argument on behalf of the minority and the American people to the
gentleman from Missouri (Mr. Gephardt), our minority leader.
(Mr. GEPHARDT asked and was given permission to revise and extend his
remarks.)
Mr. GEPHARDT. Mr. Speaker, I urge Members to vote for the motion to
recommit and, if that fails, against this legislation.
Last year, the Republicans passed their economic plan. Due to their
plan, we lost $4 trillion in surplus in about 15 months. We lost the
opportunity for long-term economic growth. We lost the chance to
promote opportunity in people's lives. And, most importantly, we lost
the chance to pay down the debt and be ready to stabilize and take care
of Social Security for the baby boomers.
But, worst of all, the plan was dishonest. When you presented the
plan, you could have gone ahead and not had a sunset in the plan and
made the tax cut go out into the future, which is what you are trying
to do today. I believe you did that because you wanted to mislead the
American people and the Congress on what was actually happening.
You had another chance when you presented your budget a few weeks ago
to say that the tax cut should not have a sunset, that it should go out
into the future. Once again, you did not do it. You did not do it
because we are already back into the Social Security trust funds
spending those dollars for current revenue needs. We are already back
into the Social Security trust fund spending those dollars for current
needs.
We passed in this House five times a lockbox that said we would never
spend the Social Security funds. Majority Whip DeLay vowed the people's
hard-earned money would be saved so they can enjoy their well-deserved
retirement. Majority Leader Armey vowed that the House is not going to
go back to raiding Social Security and Medicare. In 2001, Chairman
Nussle vowed that this Congress will protect 100 percent of the trust
funds. Period. No speculation. No supposition. No projections.
I think that everybody here probably voted at least once for the
lockbox. Well, if you vote for this bill today, you are throwing the
lockbox on the ground, breaking it open and taking all the money out of
it finally.
[[Page H1446]]
This is the definitive vote in this Congress on whether you want the
economic plan to be permanent or whether you want to save Social
Security, stabilize Social Security and ensure that it will always be
there for every citizen.
In truth, the bill that we ought to have in front of us today is not
this bill. The bill we ought to have in front of us is how to make
certain that Social Security will not be privatized, that it will not
be raided, that it will always be there for everybody in the future.
The Republicans have a plan of privatization. We think it leads to cuts
in benefits and raising the retirement age. You do not want to bring it
up this year because you do not want it to be an issue in the election.
But mark my words, it is going to be an issue in the election, and the
issue is, who is for Social Security and who is against it? Who is for
saving Social Security and who is for reducing it? Who is for making it
stable and who is for tearing it apart? The lockbox is broken open.
This is the definitive vote of this Congress, not on taxes. That has
been decided. The issue is, what is going to happen to Social Security?
I urge Members to vote ``no'' against this bill. Vote for the motion
to recommit. Save Social Security and Medicare.
Parliamentary Inquiries
Mr. THOMAS. Parliamentary inquiry, Mr. Speaker.
The SPEAKER pro tempore (Mr. Simpson). The gentleman will state it.
Mr. THOMAS. Was the minority leader's statement accurate? Is there a
vote on the motion to recommit?
The SPEAKER pro tempore. A motion to recommit is not in order.
Mr. THOMAS. There will be no motion to recommit. The minority
leader's statement was inaccurate.
Mr. RANGEL. Mr. Speaker, I have a parliamentary inquiry.
The SPEAKER pro tempore. The gentleman will state it.
Mr. RANGEL. Is it true that the Republicans crafted a rule that
denied us the motion to recommit?
The SPEAKER pro tempore. Pursuant to the rule, the previous question
is ordered to final adoption of the motion without intervening motion.
There is no opportunity under the rule for a member to offer a motion
to recommit.
Mr. RANGEL. I thank the Chair.
Mr. HULSHOF. Mr. Speaker, to conclude the debate on our side, it is
my honor and privilege to yield the balance of my time to the gentleman
from Illinois (Mr. Hastert), the Speaker of the House.
Mr. HASTERT. Mr. Speaker, we hear a lot of rhetoric at times like
this when we talk about taxes, when we talk about Social Security, when
we talk about our future. But we need to also talk about promises and
commitments that we make to people. The fact is, every dollar in a
trust fund of Social Security is tied in that trust fund. And every
promise we make not to cut benefits and not to raise taxes on Social
Security is a commitment that we have made. It is there. It is there
for a long time.
The real issue that we are talking about today is a commitment that
this House made to cut taxes of American working people and to keep a
strong economy and trying to make commitments so this economy will
work.
I have heard a lot of rhetoric. Some try to bring class warfare into
this whole issue. That is not the right thing to do, in my opinion. But
let us set the record straight. On September 30 of this year, less than
6 months ago, we paid down $450 billion in public debt. This Congress
said, ``We are going to do it.'' This Congress did exactly that.
We also said that we think American working people ought to have a
fair tax break. We said that if you are a married couple, it is not
common sense, it is not fair to be taxed $1,400 more if you are married
than if you are single. Are we going to say, we are going to do that
now, now you see it, now you don't? Nine years from now that is going
to disappear and you are going to be taxed more just because you are
married rather than being single?
We also made a commitment that if you are raising a family, if you
have four children, you are going to get a $1,000 tax credit instead of
a $500 tax credit. That is important. You are buying shoes and paying
tuition, putting gas in the car to get kids back and forth to school
and to practice and those types of things. That is important to an
American family, an American family that punches a clock every day, an
American family that brings a paycheck home every other week. Are we
going to say that 9 years from now we are going to raid, we are going
to do away with, we are going to take that $4,000 deduction, that tax
credit that that family gets? Is that fair? Does that make common
sense? No.
We know that we have this limit because we have to deal with the
other body. It is their rules, and they did not have 60 votes to change
it. So we live with that. But we do not have to live with it forever.
We do not have to tie the American people down to a now-you-see-it-and-
now-you-don't promise.
What about the family that spent their whole life building a small
business, not taking vacations so that you put a little extra money and
capital into that business so you can build it up, and you want to pass
it on to your kids and your grandkids? If you do it and that thing
slides down, if you do it 9 years from now, you can pass that on to the
next generation; but if it is 10 years from now, you will not be able
to do it. The Federal Government will come in and confiscate 52 percent
of that business.
Mr. Speaker, we are talking about common sense. If this tax break
that we passed is good for the American people, it is good for
families, it is good for small business, it is good for American
farmers. If it is good today and good tomorrow and next year, it ought
to be good 10 years from now. It is a promise. It is a commitment we
made to the American people. We need to live up to that commitment. We
will do that. Pass this legislation this afternoon.
Mr. KIND. Mr. Speaker, last year we passed a budget that boasted a
ten-year unified surplus totaling $5.6 trillion. The leadership claimed
that an expensive tax cut plan and other costly initiatives were
eminently affordable and would leave enough of the budget surplus to
eliminate most or all of the national debt. Thus Congress passed a tax
cut costing $1.3 trillion. Unfortunately, since then, most of that
surplus has disappeared, due to the war on terrorism, homeland
security, the economic downturn in the economy, and most significantly,
the large tax cut. The Congressional Budget Office (CBO) recently
projected that the budget surplus decreased this year by $4 trillion.
Now, the leadership wants to make the $1.3 trillion tax cut, due to
expire in 2010, permanent. This extension will cost over $4 trillion
and will severely undermine the Social Security and Medicare trust
funds just as 77 million baby boomers begin to retire. In fact, it will
spend the entire Medicare surplus and 93 percent of the Social Security
surplus in the next five years. Given the current forecasts, it appears
that permanent tax cuts mean permanent deficits.
Furthermore, the House passed legislation five times vowing that
every single dollar of the Social Security and Medicare trust fund
would be saved. And be put into a ``lockbox''. Now they are going back
on their word, and spending the very money that people who are working
now are counting on for their retirement security. Rather than shoring
up Social Security and Medicare, the leadership intends to pay for this
tax cut extension with the payroll taxes, which will raise interest
rates and return us to deficit spending for the next ten years.
After decades of deficit spending, it is our responsibility to reduce
the debt future generations will inherit. We must give them the
capability and flexibility to meet whatever problems or needs they
face. I cannot, in good faith, support legislation that will put our
country further into deficit spending, with a tax cut that will benefit
only the wealthiest one percent of taxpayers.
Tax relief, however, is a bipartisan issue. My colleagues on both
sides of the aisle recognize the need for tax relief, but making the
$1.3 trillion tax cut percent is not the result of bipartisanship. The
tax cut passed last year has already derailed the opportunity we had to
reduce our large national debt and prepare for our future obligations
to our aging population and children's futures. Making the tax cut
permanent will only further exasperate our nation's poor fiscal health.
Mr. Speaker, now is not the time for the House Leadership to pursue
its own individual agenda to score political points in an election
year. This is purely a symbolic vote timed as millions of Americans
filed their income tax returns.
Mr. Speaker, I urge my colleagues to oppose this fiscally
irresponsible tax cut. We must shore up Social Security and Medicare
and reduce the national debt before passing
[[Page H1447]]
such an expensive tax cut that we cannot afford. I did not come to
Congress to saddles my two boys with a debt burden they did not create.
Mr. ETHERIDGE. Mr. Speaker, I rise in strong opposition to H.R. 586,
the so-called Tax Relief Guarantee Act.
Mr. Speaker, I have supported responsible, common sense tax relief
for hardworking Americans in the past, and I will continue to do so.
Unfortunately, this irresponsible legislation mortgages the fiscal
future of America.
The House Republican Leadership is proposing to make permanent the
parts of the 2001 tax cuts that most benefit the wealthiest Americans
while leaving behind millions of middle-income families and putting the
future of Social Security in jeopardy. The cost of the first two years
of this legislation is nearly $400 billion and the cost in the second
ten years--when the baby boomers will be retiring and relying on their
Social Security benefits--will exceed $4 trillion. If the tax cut is
made permanent, every single penny of the cost over the coming decade
will come out of the Social Security and Medicare trust funds.
Mr. Speaker, the unfortunate reality of our situation is that we have
witnessed--in just one year--the most dramatic fiscal reversal in the
history of our nation. The projected surpluses are gone. Following
eight straight years of fiscal responsibility, the Republican
Leadership has decided to throw fiscal discipline out the window.
Making the tax permanent will take our nation further down the road of
fiscal denial.
Mr. Speaker, making the tax cut permanent will hurt my home state of
North Carolina. In North Carolina, we are already facing a $1 billion
budget shortfall this year. If North Carolina adopts changes to make
its tax law consistent with changes made by the Bush tax cut, it would
cost the state $258 million next year. That money will have to be
replaced by higher taxes or reduced services. Mr. Speaker, states all
across the nation are facing the same budget crunch. It is clear that
we can ill-afford to make the tax cut permanent when all of our home
states are hurting so badly.
Mr. Speaker, today's debate reminds me of a statement by my friend
Gene Sperling, the former economic advisor to the President. Mr.
Sperling said that the American Government these days reminds him of a
family with 14-year old triplets who are all heading to Ivy League
schools. The family will be fine for five or six years,but maybe in
trouble down the road. But instead of saving their money for the future
and paying down their debt, this family decides to buy a yacht and take
a trip around the world. Making this tax cut permanent does the exact
same thing with our nation's fiscal future. Mr. Speaker, let's not be
the family that buys the yacht. Let's be the family that saves wisely
to ensure our continued fiscal health. I urge my colleagues to join me
in opposing H.R. 586.
Mr. BEREUTER. Mr. Speaker, as stated on the record many times, this
Member continues his strong opposition to the total elimination of the
estate tax on the super-rich. The reasons for this opposition to this
terrible idea have been publicly explained on numerous occasions,
including statements in the Congressional Record.
This Member has every expectation that this legislation in total is
going nowhere in the other body. Furthermore, this Member has every
reasonable assurance, in this unpredictable place, that there will be a
straight up-and-down vote specifically on the elimination of the
inheritance tax. At that time, this Member will most assuredly vote
``no'' and do everything in his power to defeat the total repeal of the
inheritance tax for the wealthiest Americans.
However, this Member is strongly in favor of substantially raising
the estate tax exemption level and reducing the rate of taxation on all
levels of taxable estates and introduced legislation, H.R. 42, to this
effect. This Member believes that the only way to ensure that his
Nebraska and all American small business, farm and ranch families
benefit from estate tax reform is to dramatically and immediately
increase the Federal inheritance tax exemption level, such as provided
in H.R. 42.
This Member's bill (H.R. 42) would provide immediate, essential
Federal estate tax relief by immediately increasing the Federal estate
tax exclusion to $10 million effective upon enactment. (With some
estate planning, a married couple could double the value of this
exclusion to $20 million. As a comparison, under the current law for
year 2001, the estate tax exclusion is only $675,000.) In addition,
H.R. 42 would adjust this $10 million exclusion for inflation
thereafter. The legislation would decrease the highest Federal estate
tax rate from 55% to 39.6% effective upon enactment, as 39.6%
is currently the highest Federal income tax rate. Under the bill, the
value of an estate over $10 million would be taxed at the 39.6% rate.
Under current law, the 55% estate tax bracket begins for estates over
$3 million. Finally, H.R. 42 would continue to apply the stepped-up
capital gains basis to the estate, which is provided in current law. In
fact, this Member would be willing to raise the estate tax exclusion
level to $15 million.
Since this Member believes that H.R. 42 or similar legislation is the
only way to provide true estate tax reduction for our nation's small
business, farm and ranch families, this Member must use this
opportunity to reiterate the following reasons for his opposition to
the total elimination of the Federal estate tax. First, to totally
eliminate the estate tax on billionaires and mega-millionaires would be
very much contrary to the national interest. Second, the elimination of
the estate tax also would have a very negative impact upon the
continuance of very large charitable contributions for colleges and
universities and other worthy institutions in our country. Finally, and
fortunately, this Member believes it will never be eliminated in the
year 2010.
At this point it should be noted that under the previously enacted
estate tax legislation (e.g., the Economic Growth and Tax Relief
Reconciliation Act), beginning in 2011, the ``stepped-up basis'' is
eliminated (with two exceptions) such that the value of inherited
assets would be ``carried-over'' from the deceased. Therefore, the
Economic Growth and Tax Relief Reconciliation Act could result in
unfortunate tax consequences for some heirs as the heirs would have to
pay capital gains taxes on any increase in the value of the property
from the time the asset was acquired by the deceased until it was sold
by the heirs--resulting in a higher capital gain and larger tax
liability for the heirs than under the current ``stepped-up'' basis
law. Unfortunately, the bill before us today (H.R. 586) apparently
would also make the stepped-up basis elimination permanent resulting in
a continuation of the problems just noted by this Member--higher
capital gains and larger tax liability for heirs.
In closing, Mr. Speaker, while this Member is strongly supportive of
provisions in this bill making most of the earlier tax cuts permanent,
he cannot in good conscience support the total elimination of the
inheritance tax.
Mr. CRENSHAW. Mr. Speaker, last year this Congress passed the
Economic Growth and Tax Relief Reconciliation Act of 2001, which
reduced tax rates on individuals, married couples and estates. When the
House considered this legislation, it was our intent to permanently
enact these cuts. In an effort to circumvent a Senate procedural
roadblock, the House compromised with ``the other body'' and our
conferees settled on the legislation with an expiration after 10 years.
It is now time to revisit the intent of the peoples' House and make
this relief permanent.
Unless these cuts are made permanent, the American people will face
the largest single tax increase in history when the cuts expire on
January 1, 2011. On that date, the Marriage penalty will return--
penalizing millions of married couples who file their taxes jointly.
The child tax credit will be cut in half. The Death Tax will be
reinstated--undermining estate planning for family owned farms and
small businesses. Estates that would have no tax liability on December
31, 2010 could experience a 55 percent tax liability on January 1,
2011. Furthersome without a permanent fix, Americans will experience a
major shift in their ability to save for retirement. Contribution
limits for IRA's will drop from $5,000 to $2,000. Contributions to 401k
plans will be cut by one-third from $15,000 to $10,000 annually.
Parents saving for college will only be able to set aside 40 percent of
what they could save the day before in their children's education
savings accounts.
Congress needs to finish the job we started of promoting long-term
economic growth by making these cuts permanent. Without it, economic
growth, job creation and individual taxpayers' ability to save will be
thwarted.
I am proud to have supported legislation that is allowing Florida's
First Coast families to keep more of their hard earned money. For many
families, the advance payments that were sent out last year as part of
the relief package arrived just in time to pay for school clothes and
school supplies. Family expenses like these are not one-time-expenses
however, Mr. Speaker. We need to look down the road to make sure that
the family with a child currently in elementary school is not hit with
an increased tax burden just as they are getting ready to pay that
first tuition bill. Mr. Speaker, we need to let those planning their
retirement know that they will be able to contribute to their
retirement accounts at current or higher levels in the future without
the fear of more of their income being diverted to pay for an increase
in income tax rates instead of supporting them in their golden years.
We should never underestimate the good that can be accomplished when
families are able to keep more of their money and make spending
decisions based on their needs. Let's do what is right for the American
economy and America's families and make the tax relief contained in the
Economic Growth and Tax Relief Reconciliation Act of 2001 permanent.
Mr. STARK. Mr. Speaker, I rise in strong opposition to H.R. 586, an
irresponsible bill to extend the Bush tax cuts beyond 2010. At a
[[Page H1448]]
time when Social Security is threatened, our seniors can't buy drugs,
our children attend crumbling schools, and our environment is under
attack, the Republicans can think of nothing better to do than extend
their enormous tax cuts into perpetuity. This is a disgrace. And it's a
sad day for America.
The bush tax cut that passed last year has already thrown our
economic stability into disarray. Prior to enactment of the tax cut,
our Nation enjoyed a record $5.6 trillion surplus. With that money, we
could have saved Social Security, provided a prescription drug benefit
for our seniors, strengthened our children's education, and protected
the environment. Now, $4 trillion of that surplus is gone, and the rest
is fading fast.
Who in their right mind would vote for this bill? The people in my
district certainly wouldn't, and neither would most American families.
If a family knows that one spouse is going to be laid off and that they
will soon lose a substantial portion of their income, they don't go buy
a Ferrari on credit! As we watch our Nation's resources disappear
because of the current tax cut, why do the Republicans want to throw
the rest away?
My greatest concern today is for the people who will needlessly
suffer because of the carelessness and recklessness of this sorry bill.
Our Nation made a promise to its citizens that we would not abandon
them as they grew older. Making these tax cuts permanent would
eliminate the money needed in 2010 and beyond to ensure that we keep
this promise to our seniors--through the Social Security and Medicare
programs--and fulfill our bipartisan promise to enact a Medicare
prescription drug benefit.
The simple, unmistakable fact is that Republicans don't care about
Social Security or Medicare. They never have and they never will. They
care about their corporate contributors. And they care about the
wealthy. The rest of America, however, gets nothing but the cold
shoulder.
If the fact that this bill endangers our seniors wasn't bad enough,
look at what it does to our children. The President and his Republican
allies supported passage of the ``No Child Left Behind Act'' education
bill last year. But this year, they have failed to provide funding to
actually make those education reforms possible. As usual, the
Republicans want to appear like they care about the important issues of
working families, but they have no interest in actually funding them.
This budget cuts last year's education bill by $90 million and calls
for termination of forty educational programs. This forces my
constituents to ask a very logical question: why can Republicans find
enough money for tax cuts, but can't find enough money for our kids?
Again, the budget surplus has shrunk by $4 trillion in one year.
Extending the tax cuts will cost $400 billion over just two years, in
2011 and 2012. Analysts estimate that the 10 years after that, the tax
cuts will cost more than $4 trillion! The Center on Budget and Policy
Priorities estimates that the size of the tax cut is more than twice as
large as the Social Security financing gap. To make matters worse,
these reckless tax cuts will go into effect when the baby boom
generation starts to retire, Medicare faces a funding shortfall, and
prescription drug prices undoubtedly will be higher than ever.
I urge my colleagues to stop and think about what an additional tax
cut today will mean for our families--especially our seniors and
children.
Republicans cut taxes for sport, but this is no game. This bill
affects the lives of every American, the very people who have elected
us to look out for them and to represent their interests here. Today's
bill does nothing to help America. I urge a No vote.
Ms. DeLAURO. Mr. Speaker, when Congress considered the president's
tax proposal last spring, we had budget surpluses as far as the eye
could see. Back then the Republicans argued that we could have it all,
that the surpluses were so large we could strengthen Social Security
and Medicare, make necessary investments in education and health and
still have enough left over to pass their tax cut, half of which
benefited the wealthiest one-percent of Americans.
Well, to put it simply: they were wrong. Since that time, the economy
has slowed to a halt, layoffs have soared and $4 trillion of the
surpluses have evaporated, the quickest turnaround in our history. The
president's own numbers show that the tax cut is the main culprit,
accounting for almost half of the disappearance of the surplus. And the
Republican budget is already draining the Social Security Trust Fund.
So what is the Republicans' solution? They propose to make the tax
cut permanent which will cost $4 trillion in the decade after 2012.
That is $4 trillion gone at precisely the same time we will need the
funds to shore up Social Security and preserve Medicare. At a time when
we have serious budgetary challenges before us, we should be meeting
the priorities of the American people, not giving away the farm. Making
the tax cut permanent for the wealthiest 1 percent alone will total an
amount one-and-a-half times the entire Department of Education budget.
We should be investing in our kids, not giving away their future.
Mr. Speaker, it is not fair, it not responsible and it is terrible
policy. I urge my colleagues to reject this bill and leave this money
in the Social Security Trust Fund where it belongs.
Mr. CRANE. Mr. Speaker, I rise in strong support of H.R. 586, the Tax
Relief Guarantee Act of 2002. While I support the bill in its entirety,
I am particularly enthusiastic as regards to the chairman's amendment
to this legislation.
Last year we passed historic tax reform legislation. I am proud to
have supported it in the House and I am very pleased that, on June 7,
2001 President Bush signed the largest tax reduction in 20 years into
law. The measure reduced the ``marriage penalty,'' starting in 2005; it
doubled the child tax credit by 2010; it repealed the death tax in 2010
after cutting the top rate from 55 percent to 45 percent; and it
increased annual contribution limits on individual retirement accounts
(IRAs) and other retirement accounts. The measure also temporarily
increased the income limits exempting taxpayers from the alternative
minimum tax. This provision is in effect for 2001 through 2003.
The President's tax relief plan was eminently fair. It cut taxes for
every taxpayer. No one was targeted in and no one was targeted out. It
provided enormous tax relief to lower-income taxpayers and will take
millions off the tax rolls altogether. It left the tax system even more
progressive than previous law. Unfortunately, as enacted, all of the
measure's provisions will be repealed on December 31, 2010. That's
right, Mr. Speaker, January 1, 2011, the tax code will revert back to
the provisions that were in effect before President Bush's tax relief
legislation was signed into law. For example, beginning January 1,
2011, taxpayers in the lowest bracket (currently 10 percent) will see
their tax burden increase by 50 percent when the lowest bracket reverts
back to 15 percent. When that happens, we will have the single largest
tax increase in the history of our country. This could result in one of
the largest tax increases in American history, one that could also
destabilize long-term economic growth. A family of four with an income
of $47,000 in 2002 would face a tax hike of $1,928 in 2011--a 100
percent tax increase! Mr. Speaker, that is unacceptable.
So we are left in a situation whereby the marriage penalty tax, the
death tax, and higher marginal rates will all rear their ugly heads
come 2011 unless we take action to eliminate them permanently. In the
words of Speaker Hastert, ``How can a family make plans to pass on the
family farm or small business if there is no death tax on Dec. 31,
2010, and there is a death tax on Jan. 1, 2011?'' How indeed, Mr.
Speaker?
This legislation also includes a package of taxpayer rights
provisions, which I support. The bill also moves up--from 2003 to
2002--the effective date of the special needs adoption tax credit
provided in last year's legislation.
Mr. Speaker, this bill is not perfect. There is even more that we can
do to ease the burdens placed on American taxpayers. For example, I
believe we must eliminate the individual alternative minimum tax. This
tax was never sound policy, but it is rapidly becoming an onerous and
grossly inappropriate levy. Unfortunately, this legislation does extend
exemptions to this individual alternative minimum tax that will expire
in 2003. I would also like to see additional disincentives to
charitable giving removed, such as is provided for in my bill to remove
charitable contributions from those itemized deductions that are
subject to an income cap.
Mr. Speaker, I will continue to fight for these and other tax
reductions. In the meantime, I would like to commend Chairman Thomas
and the Rules Committee for crafting such a fine amendment. I urge my
colleagues to vote in favor of the amendment, and in favor on final
passage.
Mr. EVANS. Mr. Speaker, making last years tax cut permanent endangers
our ability to fund many of our shared priorities and is fiscally
irresponsible.
I joined many of my fellow colleagues in opposing last year's tax cut
because we knew it would cause a budget deficit and fleece Social
Security. And we were right. Now we are being asked to make these
extravagant tax cuts permanent. Many of my colleagues whom used to
preach fiscal responsibility in this house, now blindly vote to
bankrupt our government further and burden our children with a mountain
of debt. These tax cuts were the wrong remedy for an ailing economy and
now making them part of our fiscal sustenance is just bad medicine. We
all know these tax cuts grossly benefit the rich. We had an opportunity
to pass a Democratic alternative which would have greatly increased the
tax relief for working families. Instead we chose to steal from our
senior citizens by robbing from Social Security and dumping off more
debt on our children. And today the Republican leadership
[[Page H1449]]
asks us to continue on this reckless fiscal path.
When I was first elected, I told my constituents I would fight for
our common interests and priorities. I promised our seniors that I
would protect Social Security and support a prescription drug benefit.
I promised our veterans there would be money for their health care. I
promised our soldiers and sailors a well deserved pay raise. And I
promised our young people that I would expand their educational
opportunities and not rack up more debt. I am still fighting for them,
and making these tax cuts permanent makes it even harder to meet these
priorities. While, the Republican Congress is running the government's
budget on a credit card spending plan, I am explaining to my
constituents why their government cannot pay the bills.
Mr. Speaker, I urge my colleagues to vote down making permanent these
fiscally irresponsible tax cuts. Let us consider our children, our
working families, and our senior citizens before increasing the
national debt, raiding Social Security, and cutting the taxes of the
very wealthy.
Mr. GILMAN. Mr. Speaker, I rise today in strong support of H.R. 586,
the Tax Relief Guarantee Act of 2002. I urge my colleagues to support
this important measure.
H.R. 586 was an important measure that made significant changes to
the penalty and interest sections of the Internal Revenue Code and
strengthened taxpayer protections against unfair IRS collection
practices and procedures. The full House passed it by voice vote in May
2001, and was subsequently approved by the Senate.
When the other body attached an amendment to H.R. 586 to advance the
effective date of the adoption credit provision by one year, it
necessitated additional approval from the House. The Rules Committee
then approved further amending the bill to make the tax cut provisions
passed by Congress last year permanent.
In the landmark tax relief legislation passed last year, the various
provisions were set to be phased in over the following 10 years.
However, all of these various tax reduction provisions, including the
repeal of the death tax, marriage penalty relief, the lowering of
marginal rates, and the creation of the new 10 percent tax bracket, are
set to sunset after 2010.
This legislation will repeal those sunset provisions, outlined in
Title IX of H.R. 1836, making the important tax relief passed last year
permanent. By doing this, H.R. 586 will demonstrate to the American
people that Congress was serious about enacting tax cuts, and that last
year's action was not a mere short-term phenomenon. The American people
deserve to know that the tax relief they enjoyed last year, especially
the extra money from the $600 rebates, will be around for years to
come, and will not arbitrarily disappear after 2010. This bill will
accomplish this objective, and is deserving of our support.
Mr. SANDLIN. Mr. Speaker, it is time to honor the commitment we made
to American families when we passed the tax cuts last year. It is time
to help family farmers and family business owners plan for their
retirement. It is time to pass legislation that makes those tax cuts
permanent.
Since my election to Congress in 1996, I have consistently supported
efforts to eliminate the federal estate tax. Over the years, as I have
visited with folks all over my district in northeast Texas, I have
heard horror stories from families who were forced to sell all or part
of their family business or farm just to pay the estate taxes--which
reduced their inheritances by over 55 percent. I found that only about
30 percent of family businesses make it beyond one generation, and only
13 percent make it to the third generation. That simply isn't what
America is about.
Farmers, especially, struggle every day to just get by. Farmers were
left out in the cold during the economic boon of the late 1990's and
suffered as others were acquiring riches. Eliminating the estate tax is
one way to help farmers pass along their limited savings to their
children, and their children's children. Not only does this punitive
tax cause financial problems for families, some of whom are forced to
sell property that has been in the family for generations or businesses
built over a lifetime, but local economies are also hurt when jobs are
lost and businesses close. Clearly, the social and economic costs of
the estate tax far outweigh the revenue it provides for the federal
government.
Last year, I supported efforts to eliminate the federal estate tax,
voting for legislation that phased-out the estate tax over 10 years.
Unfortunately, the final version of the tax bill would not fully
eliminate the estate tax until 2010 and then would re-establish the
estate tax in 2011. The tax cut needs to be made permanent now so that
American families can make long-term plans when planning for retirement
and planning to pass their assets on to their children.
The tax cut legislation also contained many other important
provisions that together have helped mitigate the recession by pumping
nearly $40 billion into the economy. Among the other important
provisions are the phase-out of the marriage tax penalty--which removed
the disincentive to marriage contained in the U.S. tax code. Making the
tax cuts permanent means that American couples can count on their taxes
being lower--rather than facing a big increase in their taxes in 2011.
Like many of my colleagues, I am concerned about Social Security and
making sure that it continues to provide our nation's seniors with
income security. When I first voted for the tax cuts in 2001, I was
assured that there was plenty of money to pay for the tax cuts without
tapping into either the Social Security or Medicare trust funds. Since
that time, the economic conditions in our country have changed.
However, it appears that by 2011 and 2012, even under revised
estimates, there should still be plenty of money to pay for extending
the tax cuts.
I would have preferred that my Republican colleagues would have
allowed a vote on an important amendment to this legislation that would
have made the tax cuts permanent while ensuring that the Social
Security and Medicare trust funds were protected. As I mentioned last
year, when I supported the original tax cut legislation, I would have
preferred that the tax cuts include a trigger allowing delay of the tax
cuts in times of national emergencies.
This legislation also contains some important provisions, commonly
referred to as the Taxpayers' Bill of Rights. These provisions make a
number of changes to Internal Revenue Service (IRS) practices and
procedures including debt collection practices, penalties for overdue
taxes, privacy of taxpayer information and IRS employee conduct. These
are common sense provisions that will make the IRS work better for
American taxpayers while balancing enforcement with customer service.
I believe that this legislation is both important and good policy.
Today's vote simply changes tax law beginning in 2011. It does nothing
to change taxes today. I urge my colleagues to support making the tax
cuts permanent and to honor the commitment we made last year to
America's families.
Mr. UDALL of Colorado. Mr. Speaker, I cannot support this
proposition. I think everyone in the chamber knows what is going on
today. We all know why the Republican leadership has brought this bill
forward. They are more interested in trying to score some political
points than in trying to work in a bipartisan way to address the budget
and the economy. I do not think that the supporters of this proposal
expect it to become law this year. So, it might be said that there is
no reason not to vote for it. But that would not be the responsible
thing to do. A vote for this would be a vote for the underlying tax
legislation in the form that it passed the House last year. I voted
against that bill because it was based on economic projections that
were very doubtful then--and that now have been shown to have been
wildly over-optimistic.
When that bill was passed, the economic weather seemed bright--we did
not yet know that we already were in recession--and the sponsors of the
bill claimed that we could rely on that to continue not just for a
matter of months but for a full decade. Now, considering the dramatic
change in economic conditions and the need for increased resources to
fight terrorism and for homeland defense, it would seem reasonable to
review the legislation to see if it needs adjusting. But instead, the
supporters of the legislation are calling on us to say that nothing has
changed and that we should permanently lock into place all of its
provisions.
I am not opposed to cutting taxes. I have supported--and still
support--a substantial reduction in income taxes and the elimination of
the ``marriage penalty.'' I have supported--and still support--
increasing the child credit and making it refundable so that it will
benefit more lower-income families. And I have supported--and still
support--reforming, but not repealing, the estate tax. But the
affordability of last year's tax bill depended on uncertain projections
of continuing budget surpluses that now may inspire nostalgia but are
otherwise meaningless. As I said last year, the tax bill was a
riverboat gamble. It put at risk our economic stability, the future of
Medicare and Social Security, and our ability to make needed
investments in health and education. For me, the stakes were too high
and the odds were too long, and I had to vote against it.
Those same considerations still apply. I agree with the Concord
Coalition that we should not ``compound the problem by making the
entire package permanent,'' and so I cannot vote for this proposal.
Mr. ENGLISH. Mr. Speaker, we have the unique opportunity before us to
help American families. In my district, the average working family of
four makes about $36,000 a year. Failing to make these tax cuts
permanent, effectively is a vote for significantly increasing the taxes
of working Americans.
[[Page H1450]]
By making the tax cuts passed by the House almost a year ago
permanent, Americans will not face a $2,000 increase in their taxes in
2011. If these tax cuts were allowed to sunset, we would again be
taxing those saving for higher education--putting it out of reach for
many middle-class Americans. It has always struck me as odd that the
federal government taxes balances in prepaid tuition programs which in
my mind defeats the whole purpose of these valuable programs. Failing
to enact this legislation would reinstate taxes on this valuable tool
used by middle-class Americans to pay for their children's higher
education. And make no mistake--this is a tax on middle class
Americans. In Pennsylvania, families with an annual income of less than
$35,000 purchased 62 percent of the prepaid tuition contracts sold in
1996. Refusing to make this tax cut permanent will also cost families
up to $20,000 a year as the contributions to education savings accounts
shrink from $2,000 to $500 in 2011.
But beyond that college graduates--many of whom have substantial
debt--would be restricted on claiming a tax deduction for their
borrowing. They would again be limited to 60 months for deducting their
student loan interest, but the expiration of this tax provision goes
one step further. The income limits would regress to the 2001 limit
meaning the $100,000 caps for single taxpayers would drop to $40,000
while $150,000 for joint returns would drop to $60,000. $40,000 in 2002
barely pays for most college educations. I can only imagine what this
equates to in 2011 dollars.
College is no longer simply for the wealthy. More and more parents
and children realize college is a prerequisite for attaining their
dreams. Make no mistake, the debt loads are prohibitive. Congress
recognized this and took the appropriate steps to help these students
achieve their goals. By not providing permanency to these tax cuts,
Congress would deal a severe blow to those who recognize that an
education is an investment in the future. We should not further punish
struggling families and college grads by reinstating taxes, which are
the tools they depend on to make college more affordable.
Mr. JEFF MILLER of Florida. Mr. Speaker, we are considering this
legislation today because this is the right course for America and the
right course for our economic future.
Mr. Speaker, my colleagues across the aisle will continue to use
scare tactics to say that by voting for this bill you are voting to
strip seniors of their Social Security. We all know that this is simply
not true. The fact of the matter is that there will be no reduction in
Social Security or Medicare benefits as a result of the tax cut. Those
are promises made and promises that will be honored. We owe it to our
seniors to be honest about how Social Security works, similar to a
bank, who takes in a depositor's money, credits the amount to the
depositor's account, and then loans it out. In effect, what they are
saying is that we are taking Treasury bills out of the trust fund to
hand out as tax cuts. This is a ridiculous assertion. Social Security
reform is a worthy discussion, but it is one for another day.
At the same time, many will argue that we are burdening our children
with huge debt by voting for this measure. I could not disagree more
strongly. We constantly hear from our ``tax and spend'' friends that
our tax cuts need to be at a level ``that we can afford.'' That is
precisely the problem. Our government has become too large and is
asking too much of the American people, to the point where it depresses
economic growth. We must realize that our federal budget has gotten out
of control and that Washington does not always know how best to spend
the taxpayers' money.
Since the passage of last year's tax bill I have heard from many
constituents that have benefited from the measure. The simple fact is
that the federal government has long overcharged the American public,
and now is the time to permanently change this disturbing trend. We
cannot, and we should not, forgo this opportunity.
Mr. Speaker, my constituents sent me here to work for less taxes,
less government and more personal freedom. For the sake of all hard-
working Americans, let's make these tax cuts permanent. I rise in
support of this important legislation.
Mr. BLUMENAUER. Mr. Speaker, one of the most disturbing trends for
governance in America is the tendency to have short-term political
expediency regarding budget, tax, and fiscal affairs trump responsible
long-term policy. State and federal statutes and initiatives have been
passed, which allow politicians and the public to feel good in the
short term, give the illusion of solving problems, but setting up in
the long term a fiscal train wreck.
We have seen in state after state where tax cuts in the 1990s were
joined by formulas for education and corrections that basically put the
services in a form of autopilot. Money went automatically to certain
forms of education expenditure while corrections systems were mandated
to incarcerate more people for longer periods of time. These ``focus
group'' driven policy initiatives, many ratified by voters without a
careful analysis of the consequences, effectively painted states and
the federal government into a corner. Everybody appears or at least
acts like they are powerless. In the short term, given a conflicting
set of legislative and voter approved initiatives, a good argument can
be made that they are. While policies and politics are sorted out,
basic services suffer and public frustration grows.
On the federal level, we are in the midst of unraveling solid
progress of the last decade to reign in federal spending and to impose
some degree of fiscal discipline. While I didn't agree with all of the
initiatives, and in fact voted against some as a Member of Congress, we
were headed along a path that gave us choices to either restore
draconian cuts or make other adjustments to help meet legitimate needs
of our citizens.
One year ago, the projected 10-year budget surplus was $5.6 trillion
and elimination of the public debt was projected by 2010. Now, with
record increases in Defense spending and the impacts of last year's
recession well analyzed, the Republican leadership is attempting to
make permanent tax cuts that will destroy any semblance of fiscal
sanity. To fund a tax cut that delivers 44 percent of the benefits to
the wealthiest 1 percent, the Republican budget invades the Social
Security Trust Fund for a total of $1.5 trillion over the next ten
years and $4.0 trillion in the following decade. The absurdity of the
Republican leadership's fiscal policy would have a devastating effect
on the federal government's ability to fulfill its commitments, such as
Social Security and Medicare, and respond to unexpected events, like
war and recession, for decades to come.
The raid on Social Security and Medicare surpluses is not the only
problem. The education of our children, the traffic congestion in our
cities, and concerns about our drinking water and air quality are a few
of the greatest challenges facing our communities. To put the size of
the Republican leadership's tax cut and domestic priorities in
perspective, when fully effective the tax cut will be--four times the
budget for the entire Department of Education--more than three times as
large as the Department of Transportation; and--twenty-four times the
size of the Environmental Protection Agency.
This week's series of votes marks a culmination of the worst
instincts of the political process on the federal level and the
abrogation of our federal responsibilities. A year ago I voted against
a tax cut that was based on faulty logic at a time when our economy was
softening and when we had not kept commitments we said had priority.
Our Medicare system is sadly out of date with modern medical realities
and faces three serious threats: (1) It doesn't meet the needs of
seniors today who rely on ever increasing amounts of expensive drug
therapy; (2) It artificially reduces costs by squeezing providers with
a reimbursement rate for doctors and hospitals that are dramatically
below the actual cost of service; (3) The long term stability of the
Medicare program is jeopardized, while costs of this jerry-rigged
system are going to explode at precisely the time there will be more
pressures for Social Security funding.
The consensus of people I meet in Oregon and around the country is
that these policies are irresponsible. We ought to allow the majority
in the House and Senate--both Republicans and Democrats--to work
together to solve these problems. We ought not to have empty partisan
maneuvering that is a calculated to further erode political trust and
public confidence. This charade has only destructive results. It will
further inflame partisan tensions, polarize people, and make it harder
to do what responsible members of Congress and most of the public know
needs to happen--put our fiscal house in order.
Were it to actually be enacted into law it would further tighten our
fiscal straightjacket, making it harder to fulfill responsibilities and
promises, while creating artificial crises that will haunt us for years
to come. This isn't just shameless political posturing before an
election. It is evidence of a political process that is rapidly losing
its capacity to respond in a thoughtful, dignified, and public-spirited
fashion.
Mr. DINGELL. Mr. Speaker, yet again I stand here perplexed by the
actions of my Republican colleagues. Will they never cease to amaze me?
Perhaps one day I will realize that there are no lengths my colleagues
on the other side of the aisle won't go to in order to help their fat
cat buddies.
I would note that the wealthiest one percent of the population will
receive half of the benefits from this extension. The wealthiest one
percent! I ask you, Mr. Speaker, do the wealthiest one percent of our
population need our help? I think not.
Based on the most recent CBO estimates, permanently extending last
year's ridiculous tax cuts will increase the deficit by another $374
billion through 2012.
[[Page H1451]]
Mr. Speaker, just over a year ago, I stood in this very spot and
urged my colleagues to vote against the Republicans' ill conceived tax
scheme. Here we are, one year later and already back in deficit
spending. Because of these absurd tax cuts and the Republican budget,
we are taking $1.5 trillion out of the Social Security Trust Fund over
the next 10 years.
Mr. Speaker, the most simple laws of math dictate that we cannot
carry out our priorities, Democratic or Republican, with this scheme.
It is critical that we pass a Medicare prescription drug benefit and
address the dramatically rising cost of Social Security as the baby
boomers retire. Where will we get the money? How will we pay for
homeland security and the President's war on terrorism? How does the
President intend to fund his star wars program or increase the defense
budget? How will the landmark education reform the President has
advocated by carried out without any funding?
Making this tax cut permanent will raise the 10 year cost of last
year's tax bill to $2 trillion. Can we afford it? The answer, Mr.
Speaker, is no.
George Santayana, whose writings and wisdom I have found to serve
those in politics, said: Those who cannot remember the past are
condemned to repeat it. It is clear, Mr. Speaker, that my Republican
colleagues have a very short memory.
Not only do I strongly urge my colleagues to reject this bill, I
would also ask that they join me in cosponsoring a bill introduced by
my good friend from Massachusetts, Representative Frank. His bill, H.R.
2935, would repeal the reduction in the top income tax rate. This would
add about $100 billion to federal revenue over the next 10 years. All
of this money would go into the Social Security and Medicare Trust
Funds, where it is needed.
Mr. PASTOR. Mr. Speaker, I rise today to oppose this legislation to
extend last year's tax cut beyond 2010. Passage of this bill will only
serve to further erode the Social Security Trust Fund and leave those
who will be retiring in the next decade wondering if promises made will
be kept.
Almost a year ago, we passed an unfair tax cut which gave the top one
percent of income earners almost 40 percent of the tax benefits. It was
not right then, it is not right now, and it will not be right in 2011,
when this legislation takes effect.
The world changed on September 11. We are now fighting a war on
terrorism which I strongly support. We now must provide additional
funds for homeland security. I support this also.
But within the last ten months, since the $1.35 trillion tax cut was
passed, we have gone from a projected surplus of $5.6 trillion to
deficit spending. Forty percent of the disappearing surplus, the
greatest chunk, is attributed to the tax cut. I supported a tax cut,
but not this one which did nothing, in my view, to stimulate the
economy. It only served to make the wealthier among us better off. In
my view, it would be unwise to make it permanent.
Instead, I believe it would be more prudent to address the issues
that many of my constituency are talking to me about every weekend when
I am home in Arizona. Seniors are worried about where they will find
the money to pay for their prescription drugs. Parents are trying to
find the best schools for their children; schools that are not
overcrowded, and that are not in disrepair, and that have the most
modern equipment and qualified teachers. Young adults are searching for
ways to afford college and they need Pell Grants and other means of
financial support. While it appears the economy is on its way to
recovering, unemployment continues to rise and people want to know that
there are training opportunities out there if they don't have a job or
if they should lose the one they do have. With the tremendous growth in
Arizona, people are worried about affordable housing.
These are the issues that are important to most Americans.
Mr. Speaker, we all support tax cuts. We all believe that Americans
should keep more of their hard earned money. But we also know that
there are many needs out there is our country.
I regret that I will not able to support this extension of last
year's tax cut. Nor will I be able to support any further tax cuts that
are being considered. New tax cuts or the extension of this tax cut
means we will continue to raid Social Security and further neglect the
people who are not among the top income earners in this country.
I urge my colleagues to reject this unfair, unwise, and unjust
legislation.
Mr. COYNE. Mr. Speaker, I rise in opposition to this misguided
legislation.
Last year the House, against my opposition, passed a massive tax cut.
That legislation will reduce federal revenues by more than a trillion
dollars. If the additional interest costs of this tax cut are added in,
the total change in the federal government's financial standing comes
close to two trillion dollars. I should add that many of the provisions
in last year's tax cut bill were phased in gradually, so that the total
annual impact of the bill would not be felt for nearly a decade. The
provisions in the legislation enacted last year would expire after ten
years--but if we make those provisions permanent, as the bill currently
under consideration would do, recent estimates indicate that in the
decade after 2012, they will reduce federal resources by four trillion
dollars.
As I said last year during House consideration, of the tax cut bill,
``the revenue loss to the federal government will explode after the
year 2001--just when millions of Baby Boomers retire, the cost of
Social Security and Medicare will explode.'' Given the current
challenges that face Social Security and Medicare, it seemed to me
then--and it seems to me now--that we ought to spent the coming decade
preparing for the anticipated increased future demands that will be
placed on Social Security and Medicare by paying down some of our $5
trillion national debt. Instead, Republicans in Congress cut taxes
dramatically and produced budget deficits for the foreseeable future.
It is a shame that we squandered the opportunity last year to invest
in our nation's future. It is a disgrace that today our Republican
colleagues propose to dig the hole deeper. I urge my colleagues to do
the sensible thing and pursue a conservative, fiscally responsible
federal budget policy.
I will oppose this misguided legislation, and I urge my colleagues to
do the same.
Mr. McDERMOTT. Mr. Speaker, here comes the train again. Last month,
my Republican colleagues passed a fiscally irresponsible budget that
called for spending hundreds of billions of dollars from the Social
Security Trust Fund on tax cuts for the wealthy.
Mr. Speaker, we gambled with tax cuts last year, we gambled again
last month, and here we are today, rolling the dice one more time.
In 1999, 2000, and 2001, Republicans in this chamber voted seven
times to fully protect the Social Security Trust Fund. George W. Bush
echoed the theme on the campaign trail and during the Presidential
debates--he wanted to put those reserves in a ``lock-box'' to prevent
it from being used to pay for tax cuts or additional spending. Even the
beloved Speaker of the House stated, ``We are going to wall off the
Social Security Trust Funds . . . We are not going to dip into that at
all.'' Remember when you said that, Mr. Speaker?
Now it appears that the government will raid the Social Security
surplus for as far as the eye can see. And extending the tax cuts
permanently would only worsen the deteriorating fiscal outlook.
Mr. Speaker, this bill amounts to an intergenerational mugging. Our
children will pay for the debt we incur today. The 75-year cost of
making the tax cuts permanent would be more than twice as great as the
entire shortfall projected in the Social Security Trust Fund.
Furthermore, this bill, and you won't hear the Republicans mention
this during the debate, will also cost the U.S. Treasury $4 trillion
during the decade after 2012--just when the Baby Boomers are retiring
in earnest and both the Social Security and Medicare systems are coming
under mounting financial strain. If the congressional Republicans
continue to sacrifice the safety of Social Security and Medicare, for
the sake of tax cuts for the wealthy, America will be a country where
the rich stay healthy and the sick stay poor. If we simply look at the
budget forecast, it is clear that permanent tax cuts mean permanent
deficits.
Mr. Speaker, these tax cuts are so heavily skewed to benefit the
wealthy that the richest one-percent of taxpayers would receive tax
breaks that equal one and one half times the entire budget of the
Department of Education. If we completely repeal the estate tax, in
particular, we'll be essentially creating intergenerational gated
communities. Our capitalist friend, Adam Smith, said, ``A power to
dispose of estates for ever is manifestly absurd. The earth and the
fullness of it belongs to every generation, and the preceding one can
have no right to bind it up from posterity.
Mr. Speaker, this chamber sometimes seems like the House of Lords,
because it attempts to do everything in its power to protect the
pseudo-aristocracy. Mr. Speaker, we need this bill about as much as we
need a runaway train. I urge my colleagues to oppose this campaign sop,
disguised in the form of H.R. 586.
The SPEAKER pro tempore. All time for debate has expired.
Pursuant to House Resolution 390, the previous question is ordered.
The question is on the motion offered by the gentleman from
California (Mr. Thomas).
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Recorded Vote
Mr. HULSHOF. Mr. Speaker, I demand a recorded vote.
A recorded vote was ordered.
[[Page H1452]]
The vote was taken by electronic device, and there were--ayes 229,
noes 198, not voting 8, as follows:
[Roll No. 103]
AYES--229
Aderholt
Akin
Armey
Bachus
Baker
Ballenger
Barcia
Barr
Bartlett
Barton
Bass
Bereuter
Biggert
Bilirakis
Blunt
Boehlert
Boehner
Bonilla
Bono
Boozman
Brady (TX)
Brown (SC)
Bryant
Burr
Burton
Buyer
Callahan
Calvert
Camp
Cannon
Cantor
Capito
Castle
Chabot
Chambliss
Coble
Collins
Combest
Condit
Cooksey
Cox
Cramer
Crane
Crenshaw
Cubin
Culberson
Cunningham
Davis, Jo Ann
Davis, Tom
Deal
DeLay
DeMint
Diaz-Balart
Doolittle
Dreier
Duncan
Dunn
Ehlers
Ehrlich
Emerson
English
Everett
Ferguson
Flake
Fletcher
Foley
Forbes
Fossella
Frelinghuysen
Gallegly
Ganske
Gekas
Gibbons
Gilchrest
Gillmor
Gilman
Goode
Goodlatte
Gordon
Goss
Graham
Granger
Graves
Green (WI)
Greenwood
Grucci
Gutknecht
Hall (TX)
Hansen
Hart
Hastert
Hastings (WA)
Hayes
Hayworth
Hefley
Herger
Hilleary
Hobson
Hoekstra
Horn
Hostettler
Houghton
Hulshof
Hunter
Hyde
Isakson
Issa
Istook
Jenkins
Johnson (CT)
Johnson (IL)
Johnson, Sam
Jones (NC)
Keller
Kelly
Kennedy (MN)
Kerns
King (NY)
Kingston
Kirk
Knollenberg
Kolbe
LaHood
Latham
LaTourette
Leach
Lewis (CA)
Lewis (KY)
Linder
LoBiondo
Lucas (KY)
Lucas (OK)
Manzullo
McCrery
McHugh
McInnis
McIntyre
McKeon
Mica
Miller, Dan
Miller, Gary
Miller, Jeff
Moran (KS)
Myrick
Nethercutt
Ney
Northup
Norwood
Nussle
Osborne
Ose
Otter
Oxley
Paul
Pence
Peterson (PA)
Petri
Pickering
Pitts
Platts
Pombo
Portman
Pryce (OH)
Putnam
Quinn
Radanovich
Ramstad
Regula
Rehberg
Reynolds
Riley
Roemer
Rogers (MI)
Rohrabacher
Ros-Lehtinen
Royce
Ryan (WI)
Ryun (KS)
Sandlin
Saxton
Schaffer
Schrock
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shuster
Simmons
Simpson
Skeen
Smith (MI)
Smith (NJ)
Smith (TX)
Souder
Stearns
Stump
Sullivan
Sununu
Sweeney
Tancredo
Tauzin
Taylor (NC)
Terry
Thomas
Thornberry
Thune
Tiahrt
Tiberi
Toomey
Upton
Vitter
Walden
Walsh
Wamp
Watkins (OK)
Watts (OK)
Weldon (FL)
Weldon (PA)
Weller
Whitfield
Wicker
Wilson (NM)
Wilson (SC)
Wolf
Young (AK)
Young (FL)
NOES--198
Abercrombie
Ackerman
Allen
Andrews
Baca
Baird
Baldacci
Baldwin
Barrett
Becerra
Bentsen
Berkley
Berman
Berry
Bishop
Blagojevich
Blumenauer
Bonior
Borski
Boswell
Boucher
Boyd
Brady (PA)
Brown (FL)
Brown (OH)
Capps
Capuano
Cardin
Carson (IN)
Carson (OK)
Clay
Clayton
Clyburn
Conyers
Costello
Coyne
Crowley
Cummings
Davis (CA)
Davis (FL)
Davis (IL)
DeFazio
DeGette
DeLauro
Deutsch
Dicks
Dingell
Doggett
Dooley
Doyle
Edwards
Engel
Eshoo
Etheridge
Evans
Farr
Fattah
Filner
Ford
Frank
Frost
Gephardt
Gonzalez
Green (TX)
Gutierrez
Hall (OH)
Harman
Hill
Hilliard
Hinchey
Hinojosa
Hoeffel
Holden
Holt
Honda
Hooley
Hoyer
Inslee
Israel
Jackson (IL)
Jackson-Lee (TX)
Jefferson
John
Johnson, E. B.
Kanjorski
Kaptur
Kennedy (RI)
Kildee
Kilpatrick
Kind (WI)
Kleczka
Kucinich
LaFalce
Lampson
Langevin
Lantos
Larsen (WA)
Larson (CT)
Lee
Levin
Lewis (GA)
Lipinski
Lofgren
Lowey
Luther
Lynch
Maloney (CT)
Maloney (NY)
Markey
Mascara
Matheson
Matsui
McCarthy (MO)
McCarthy (NY)
McCollum
McDermott
McGovern
McKinney
McNulty
Meehan
Meek (FL)
Meeks (NY)
Menendez
Millender-McDonald
Miller, George
Mink
Mollohan
Moore
Moran (VA)
Morella
Murtha
Nadler
Napolitano
Neal
Obey
Olver
Ortiz
Owens
Pallone
Pascrell
Pastor
Payne
Pelosi
Peterson (MN)
Phelps
Pomeroy
Price (NC)
Rahall
Rangel
Reyes
Rivers
Rodriguez
Ross
Rothman
Roybal-Allard
Rush
Sabo
Sanchez
Sanders
Sawyer
Schakowsky
Schiff
Scott
Serrano
Sherman
Shows
Skelton
Slaughter
Smith (WA)
Snyder
Solis
Spratt
Stark
Stenholm
Strickland
Stupak
Tanner
Tauscher
Taylor (MS)
Thompson (CA)
Thompson (MS)
Thurman
Tierney
Towns
Turner
Udall (CO)
Udall (NM)
Velazquez
Visclosky
Waters
Watson (CA)
Watt (NC)
Waxman
Weiner
Wexler
Woolsey
Wu
Wynn
NOT VOTING--8
Clement
Delahunt
Hastings (FL)
Jones (OH)
Oberstar
Rogers (KY)
Roukema
Traficant
{time} 1450
Ms. WOOLSEY, Mr. ACKERMAN, and Mr. OWENS changed their vote from
``aye'' to ``no.''
So the motion was agreed to.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.
Stated against:
Mr. OBERSTAR. Mr. Speaker, this afternoon I greatly enjoyed the
opportunity to visit with high school students from Becker, Minnesota
who are participating in the Close-Up program. As a result of our
visit, I was unable to record my vote during the consideration of the
misguided tax legislation that will undermine Social Security.
Had I been present, I would have voted ``no'' on rollcall 103, for I
strongly opposed last year's irresponsible tax bill, and I certainly do
not support making these tax law changes permanent. If enacted, this
fiscally reckless plan would spend $400 billion on tax cuts for the
wealthy, every penny of which comes directly out of Social Security.
____________________