http://archive.nytimes.com/2003/02/09/politics/09TAX.html
Bush Seeks Tax Cuts He Had Scorned By DAVID E. ROSENBAUM WASHINGTON, Feb. 8 � President Bush's tax plan include dozens of small tax breaks for interests as disparate as insurance companies, elite private universities, operators of landfills and people of modest means who donate to their churches. These items have received little notice, because individually they are insignificant compared with the president's sweeping proposals to lower tax rates and make most people's returns on investments tax free. But altogether, the tax breaks for special interests could total hundreds of billions of dollars in revenue losses over the next 10 years. Many of these proposals are similar to the ones Mr. Bush scoffed at when they were proposed in the 2000 election campaign by his Democratic opponent, Al Gore. For instance, at a rally in Little Rock, Ark., about two months before the election, Mr. Bush made this criticism of Mr. Gore's tax proposals: "The tax code is too complicated as it is. My opponent's plan makes it more complicated with a lot of fine print. You get tax relief if you behave a certain way or only if you meet certain small categories. It's so targeted, it misses the target." Mr. Bush declared at the rally, "I believe that everybody who pays taxes ought to get tax relief," not just "the right people," as defined by Mr. Gore. The president's spokesman, Ari Fleischer, said Friday that Mr. Bush's point in the campaign was not that Mr. Gore's tax proposals had no value but that they were hit and miss and did not benefit everyone. As for the small provisions in Mr. Bush's tax plan this year, Mr. Fleischer said, "some are designed to help only a few, but that does not mean they are not meritorious." Some of Mr. Bush's proposals have broad bipartisan support. An example is the continuation of an expiring tax credit for business research and experimentation, which would cost the government $68 billion in lost revenue over 10 years, the Treasury estimates. Congress generally extends this credit a few years at a time rather than making it permanent so that the lawmakers can periodically get credit for approving a measure important to businesses. Other proposals face strong opposition, including several tax breaks for people who buy their own health insurance. Together, these four credits or deductions would cost more than $100 billion in revenue losses. Opponents maintain that these items were designed to make workers rather than their employers responsible for health insurance. Some of Mr. Bush's proposals this year fit with his social policies. For example, tax authorities say that people who give small sums to their churches would be the main beneficiaries of letting taxpayers claim deductions of up to $250 apiece for charitable contributions even if they do not otherwise itemize their deductions. This proposal would cost $12.8 billion over 10 years. Mr. Bush is interested in helping religious institutions provide social services. Others would help particular lobbies or campaign donors. A tax credit Mr. Bush seeks for companies that convert landfill gases into electricity ($712 million over 10 years) is being pushed by Waste Management Inc., the Houston company that operates landfills. One of the main beneficiaries of an expansion of medical savings accounts, another Bush proposal, would be the Golden Rule Insurance Company of Lawrenceville, Ill., the leading underwriter of high-deductible medical insurance policies. The company is a big donor to the Republican Party and Republican politicians. The price is $5.1 billion over 10 years. A new tax credit for developers of low-cost single-family houses ($16.1 billion over 10 years) is eagerly sought by homebuilders, an influential lobby because there are such developers in almost every Congressional district. Another ubiquitous business, pizza franchises, was behind a proposal ($891 million over 10 years) to expand deductions for companies that donate leftover food to charity. The enhanced deduction, the Treasury Department states in its description of the proposal, would be available only for donations of "apparently wholesome food." Elite Eastern universities have been lobbying hard for one of Mr. Bush's proposals � a repeal of the $150 million ceiling on the value of bonds nonprofit organizations other than hospitals are permitted to issue. The repeal would cost $84 million over 10 years in lost revenue. Bonds like this are mainly issued to raise capital for buildings, and few nonprofit institutions other than universities with big endowments have large capital projects and could benefit from raising the limit on bonds. Among the many other proposals by the president are tuition tax credits of up to $2,500 a year for parents who take their children out of failing public schools and put them in private schools ($3.8 billion), a tax exclusion for computers provided to employees who work at home ($554 million) and an expansion of the kinds of waste matter eligible for a tax credit if burned to create electricity ($1.5 billion). Mill residues, waste pallets and orchard and vineyard residue would be included in the material that could be burned for electricity. But chicken droppings were explicitly excluded. That is because Congress already voted last year to extend through 2007 the credit for converting poultry waste into power. _______________________________________________ http://www.mccmedia.com/mailman/listinfo/brin-l
