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House passes minimum wage increase
August 2, 1996
Web posted at: 1:30 p.m. EDT
WASHINGTON (CNN) -- The House of Representatives Friday approved a 90-cent-an-hour increase in the minimum wage, sweetened by some $21 billion worth of tax cuts, mostly for business.
The bill passed on a 354-72 vote, with 70 Republicans and two Democrats voting against, as Congress pushed to wind up a pre-recess legislative marathon.
The measure boosts the minimum wage from $4.25 to $4.75 an hour effective October 1, and then to $5.15 an hour on September 1, 1997. It's the first rise in five years and will benefit more than 10 million workers, two-thirds of them adults.
The measure was sent to the Senate, where quick action was expected. President Clinton has promised to sign the measure when it reaches his desk.
Republican leaders of the House and Senate had resisted the measure, finally giving in to majorities in both the houses and widespread public support for the increase.
In part to entice Republicans to support the measure, the legislation includes $21.4 billion in tax breaks over 10 years. That portion of the bill would provide more generous equipment write-offs for small businesses and a new type of simplified pension plan for companies employing 100 or fewer workers.
"The House is ... enacting the first major tax bill of this new and historic 'did-something' Congress," said House Ways and Means Chairman Bill Archer, R-Texas.
But air travelers would find themselves paying a 10 percent tax on airline tickets to help offset the cost of the tax breaks. The measure reinstates, through the end of the year, the excise tax on airline tickets and other aviation taxes.
The bill would also:
- Reinstate credits that encourage corporations to conduct
research, pharmaceutical companies to develop drugs for rare
diseases and businesses to provide jobs for welfare
recipients and other hard-to-hire people.
- Provide a $5,000 credit for domestic adoptions through
2001 and a $6,000 credit permanently for hard-to-place
children
- Retroactively reinstate the $5,250 exemption for
employer-provided tuition and extends it through June 1996
for graduate-level tuition and May 1997 for undergraduate
tuition.
- Permit homemakers to contribute $2,000 to Individual Retirement Accounts.
The Associated Press and Reuters contributed to this report.
Related stories:
- Raising minimum wage seems inevitable - May 6, 1996
- Democrats revive campaign to raise minimum wage - Mar. 6, 1996
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