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Bush tax cut plan introduced on Capitol Hill
From Ted Barrett
WASHINGTON (CNN) -- Treasury Secretary John Snow joined lawmakers Thursday to formally introduce President Bush's roughly $674 billion tax relief package. The bill, which is centered on a proposal to eliminate taxes on corporate dividends, has generated only lackluster support among congressional Republicans and near-unanimous opposition from Democrats. Snow said the tax package would create "millions of new jobs" and predicted congressional backing for the measure would grow. "When you've got good idea, when you've got good tax policy -- and this is good tax policy -- when you've got good economics behind your good tax policy, you will carry the day," Snow said. "This is a tax policy that will stand up to scrutiny. This is economics that will stand up to scrutiny." Georgia Sen. Zell Miller, the only congressional Democrat to publicly support the bill, was at Snow's side. "The president has come up with a bold, well-thought-out plan that will let virtually every American who pays taxes keep more of their hard-earned money," Miller said. But Democratic leaders said the president's dividend tax cut favors the wealthy and will add to the mounting budget deficit. "Democrats like tax cuts, too," said House Democratic Leader Nancy Pelosi. "But they have to be fair, fiscally sound, and in the case of stimulus, fast-acting to help grow the economy." Democrats also complained the country can't afford a tax cut as it heads to war. "We have an anticipated debt of $400 billion this year, and that's before the first dollar in whatever military action may be required will be expended," said Senate Minority Leader Tom Daschle. "Without a question, this will exacerbate the debt and complicate our fiscal circumstances beyond anything, I would say, in history." The centerpiece of the bill is the elimination of the taxation on dividends. It has drawn the most scrutiny from lawmakers, many of whom support the change in theory -- saying it is double taxation that is both unfair to stockholders and restrictive on corporations -- but think it's tilted to the wealthy and too expensive to pass now. "The shrill class-warfare crowd can jump up and down all they want -- this is no sop to the rich," Miller said in defense of the cut. "In Georgia, 60 percent of the dividend earners make less that $75,000. Is that rich?" Republican leaders acknowledged the White House bill would likely be changed. "Some people think there are cons associated with the president's plans," said House Ways and Means Committee Chairman Bill Thomas, R-California. "And there are those who believe the concept is a good one but there could be alternatives." Daschle agreed the bill will need to be changed if it's going to pass. "I can think of a handful of Republicans who have now come forward to say they too oppose the tax cut. So there is good reason to believe there will be a bipartisan coalition in opposition to the president's tax cut, here in the Senate, for the first time since this president has come to office." Republicans predict that the economy will flourish if the bill is passed and new revenues to Washington will make up for much of the revenue given up by the tax cut. "The deficits that result from this are really an investment in our future," Snow said. "They are appropriate for the time we find ourselves in, as we wage a war on terrorism and increase homeland security and put people back to work." The House will begin hearings on the president's plan in two weeks and expects to complete floor action by the end of March. Senate leaders have said they hope to approve the tax package as part of the budget process, which by law must be completed by April 15.
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