http://www.startribune.com/stories/587/3909558.html
Democrats: Lowest-earning families denied child tax credit David Firestone, New York Times Published May 30, 2003 TAXC30 WASHINGTON, D.C. -- The Bush administration on Thursday defended the decision of congressional negotiators to deny millions of minimum-wage-earning families the increased child tax credit. White House press secretary Ari Fleischer said the new tax law was intended to help people who pay taxes, not those who are too poor to pay. Democrats seized on the decision as an illustration of what they called the essential unfairness of legislation that provides most of its benefits to the wealthy. They promised to propose a bill that would extend the increased credit to those denied it: most families earning from $10,500 to $26,625. The measure would cost $3.5 billion, and could embarrass Republicans if they chose to vote against it. "While the Republican tax break leaves no business behind, it leaves behind millions of children from working-poor families," said Rep. Nancy Pelosi, D-Calif., the House Democratic leader. "Faced with a choice between giving a tax break to an elite few or helping millions of working families, the Republicans once again chose to help their wealthy friends." Senate Democratic leader Tom Daschle, of South Dakota, said that helping those families should be the first order of business when Congress returns next week, and he wrote President Bush on Thursday saying the Democrats would be happy to pass such a measure if Bush agreed. Fleischer said the president would have signed a tax-cut bill that did extend the credit to those families cited by the Democrats, but that negotiators had to decide whether to help taxpayers or those who pay no taxes. "Does tax relief go to people who pay income taxes and forgive their income taxes, or does it go above and beyond the forgiving of all income taxes, and you actually get a check back from the government for more than you ever owed in income taxes?" he said. "And this is part and parcel of the debate over tax relief. This certainly does deliver tax relief to the people who pay income taxes." Fleischer also said the bill would wipe out all tax liability for 3 million taxpayers. Bob McIntyre, director of the liberal research group Citizens for Tax Justice, said he agreed with that calculation, mainly because the increased child tax credit will help families who earn $26,625 to about $40,000. But most of those earning less do not qualify for the $400-a-child checks that will be mailed this summer to higher-income-earning families, because Republican negotiators, seeking to fit other tax cuts into the $350 billion bill, dropped a Senate plan to help the lower-income-earning families. The plan would have changed the child-credit formula to allow families earning just above the minimum wage to get refunds of all or part of the $400. Fleischer said that the millions of low-income Americans who owe no taxes but receive tax credits were actually receiving a form of public assistance, and that was fundamentally different from the tax breaks the new bill gives to those higher-earning families that owe income taxes. "By actually forgiving all income taxes and then giving people money above and beyond that, it's not the same as the way other people on the income scale are treated," he said. Low-income people, he added, already are appreciative of the fact that they pay no income taxes yet benefit from federal programs. Democrats and some moderate Republicans, however, said that it was essentially unfair to give the child tax credit to most middle-income families but not to those lower on the income scale. The wealthiest taxpayers do not benefit from the child credit, which phases out at higher incomes. Sen. Olympia J. Snowe, R-Maine, said the lack of a benefit to minimum-wage-earning families was one of the reasons she voted against the bill. "This ill-founded decision creates a two-tier system under the child tax credit, penalizing low-income working families who need the help most," she said. "Not only is this unfair, but it further undermines the stimulus portion of the child credit," because the lowest-income people would be most likely to spend the refund. --- 'Governor Bush has not changed his position on abortion. He is no hypocrite (?). It was illegal when he had it done and he wants it to be illegal for everyone else, too. Fair is fair.' -- Ari Fleischer _______________________________________________ http://www.mccmedia.com/mailman/listinfo/brin-l
