[Congressional Record Volume 148, Number 104 (Friday, July 26, 2002)]
[Senate]
[Pages S7432-S7433]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Ms. LANDRIEU:
  S. 2807. A bill to amend the Internal Revenue Code of 1986 to clarify 
the treatment of dependent care assistance programs sponsored by the 
Department of Defense for members of the Armed Forces of the United 
States; to the Committee on Finance.
  Ms. LANDRIEU. Mr. President, I rise today to introduce two bills. One 
will give tax relief to a small group of men and women in our armed 
services stationed on the island of Diego Garcia in the Indian Ocean, 
supporting the war on terrorism in Afghanistan. The second bill will 
exclude from gross income childcare benefits paid to members of our 
armed forces. These are small measures,but both will be of great 
benefit to the men and women serving our country.
  Diego Garcia is a British Territory lying seven degrees South 
Latitude off

[[Page S7433]]

the coast of India, in the middle of the Indian Ocean. The island is 40 
miles around and encompasses an area of 6,720 acres, most of it 
dominated by a large lagoon. The land mass is actually very small. It 
is home to a joint British-United States Naval Support Facility, and 
while there are only a small handful of British Royal Navy personnel on 
the island, there is a larger, tight-knit team of American Air Force, 
Navy, and Army personnel on the island. These men and women serving on 
Diego Garcia are supporting B-52 bombing missions and other operations 
over Afghanistan. Many of them are from the 2nd Bomb Wing and the 917th 
Wing. Both units call Barksdale Air Force Base in Louisiana their home.
  As a Nation, we provide members of our armed forces with a variety of 
benefits, all of them deserve. They receive hardship duty pay of $150 
per monthly for serving in austere regions of the World. They get 
imminent danger pay of $150 per month as compensation for being in 
physical danger. One of the most generous benefits for those serving in 
the war on terrorism is the combat zone tax exclusion. Members of the 
armed services do not pay Federal tax on compensation they for any 
month of service inside a combat one. They only have to serve on day in 
the combat zone to get this benefit. The exclusion only applies to 
personnel who receive imminent danger pay.
  On Diego Garcia, the pilots and flight crews who fly the missions 
over Afghanistan are eligible for the income tax exclusion because they 
receive imminent danger pay. But the men and women who load the 
bombers, fuel them, and maintain them are not eligible because they do 
not enter the combat zone. My office was contacted by the officers who 
fly the bombing missions about this discrepancy. They asked me to help 
out their support crews, a gesture of selflessness that I want to 
honor.
  I recognize that the support crews may not receive imminent danger 
pay, but their situation is not too different from Naval personnel 
performing the same tasks on ships in the Arabian Sea. Naval support 
crews receive imminent danger pay and are eligible for the tax 
exclusion, but they do not enter Afghanistan.
  Diego Garcia is a beautiful place, but it is a long way from home. 
The least we could do is treat everyone who has served on the island 
the same. That is what my bill will do.
  My second bill will correct an omission in the Tax Reform Act of 
1986. That Act contained a provision consolidating the laws regarding 
the tax treatment of certain military benefits. The Conference Report 
to that Act contains a long list of benefits to be excluded from gross 
income of military personnel. According to the report, this list was to 
be exhaustive. The problem is that child car benefits are not on that 
list.
  I do not know if this omission was intentional. Perhaps at that time, 
child care benefits were relatively unknown in the military. The 
Conference Report gives the Treasury Secretary the authority to expand 
the list of eligible benefits, but so far the Secretary has not 
provided any guidance to the Department of Defense as to how these 
benefits should be treated for tax purposes. While military families 
are not currently being taxed for child care benefits, the Department 
of Defense has indicated that it would like Congress to clarify that 
child care benefits are not subject to tax. My bill will give our 
military families and the Department of Defense a greater degree of 
certainty.
  Throughout our history, in time of war we have worked to make sure 
that our armed forces have everything they need and we have spared no 
expense in meeting that need. But the men and women on the ground often 
have families back at home. We should make sure that we support them as 
well. I urge my colleagues to support this legislation.

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