Issues Before Congress

Renewed Tax cut Talk

House Republicans say they will work for a tax cut of $80 billion over five years. House Ways and Means Chairman Bill Archer (R-Texas) is reportedly drafting the tax bill and could have it ready by the end of next week.

  • The bill will likely contain relief for some two-income couples, tax breaks for farmers and ranchers hit by the economic downturn in agriculture and an increase in the income retirees can earn without losing some of their Social Security benefits.

  • Republicans are also considering changes to the alternative minimum tax -- which was originally intended to ensure that wealthy people do not escape taxes through shelters and other strategies, but which now affects a growing number of middle-income families.

  • Chairman Archer has also supported allowing self-employed people to deduct more of their health-insurance costs.

President Clinton is expected to oppose the tax cuts.

In a related matter, Congress and the Clinton administration may be headed for a showdown over spending bills which must be passed by the start of the new fiscal year on October 1. The administration has issued veto threats over seven bills as passed by the House and two Senate versions.

Source: Richard W. Stevenson, "House Republicans to Seek a Big Tax Cut," New York Times, September 10, 1998.

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