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To: Giordano Bruno who wrote (244200)	6/5/2003 9:29:43 PM
From: Giordano Bruno	Read Replies (1) \| Respond to of 436258

U.S. Senate Passes Bill To Give Poor Families Child Tax Credit - 94 to 2 June 5 (Bloomberg) -- The U.S. Senate passed legislation giving $9.7 billion to many poor parents and married couples that don't pay income taxes, after Democrats said those people wouldn't benefit from a $330 billion tax-cut bill enacted last month. President George W. Bush had signed the tax cut without a provision extending a $400 increase in the credit to poor families with almost 12 million children. Senate Republican and Democratic leaders agreed on the legislation earlier today. ``We have to recognize when we don't pay attention to details, there are many individuals who get left behind,'' said Senator Blanche Lincoln, an Arkansas Democrat who pressed for the provision. The Senate added the child credit to another bill by a 94-2 vote, then passed the amended legislation on a voice vote. The legislation would mute Democratic criticism that the tax- cut, reducing taxes on dividends and lowering the top marginal rates, favors wealthy investors at the expense of the poor, including almost 190,000 U.S. military personnel with children. ``This administration is waging war on poor children,'' New York Democratic Senator Hillary Rodham Clinton said in a Capitol office building before the measure passed. A green banner reading ``Tax relief should leave no child behind'' hung behind Clinton, a reference to a Bush campaign slogan. Senate Republicans dropped an insistence that adding breaks for the poor should be considered with other tax cuts. Senate Finance Committee Chairman Charles Grassley said he hopes Bush will sign the measure by mid-month, in time for child credit checks to be mailed to taxpayers. ``Everyone in Congress believes those who benefit in this bill ought to get their checks at the same time as everyone else,'' Grassley said. Checks The House of Representatives must pass a similar measure before the credit is extended to poor families. Checks to be mailed to the families will be an advance payment of a $400 increase, to $1,000, in the per-child tax credit effective Jan. 1 of this year. Clinton and others lawmakers complained that many families that earn between $10,000 and $26,625 don't pay enough taxes to qualify for the credit and won't get any benefit. Some military personnel also wouldn't get a check because some of their income became tax-free if they served in war zones of Iraq or Afghanistan. Without taxable income, they wouldn't qualify for the credit. Under the legislation passed today, all of those families would receive checks. The measure also makes it easy for many children to qualify for the credit and boosts to $150,000 the current law cap of $110,000 after which married couples earn too much to claim it. The cap remains at $75,000 for single parents. House Plans Families with children born in 2003 will claim a full $1,000 tax credit on their tax returns next year. ``This clearly is a win for working families, it's a win for the economy, and it's certainly a win for fiscal responsibility,'' said Maine Republican Senator Olympia Snowe, who backed the agreement with Arkansas Democrat Blanche Lincoln. The Senate's bill would have no effect on federal deficits because lawmakers would raise Customs Department fees by an equivalent $10 billion. House Republican leaders said they would consider adding child tax cuts only as part of broader tax legislation. ``We may want to do that, in the proper way, under regular order,'' House Majority Leader Tom DeLay said in a floor speech. ``We may have two or three more tax bills in this Congress.'' The House may consider the child tax credit next week, said John Feehery, spokesman for House Speaker Dennis Hastert. ``We'll probably do something much more aggressive,'' Feehrey said in an interview. `Disjointed Discussion' If the deal fails to become law, up to 6 million low-income families with incomes of less than $26,625 wouldn't receive a check because they don't pay enough in income taxes to claim the credit. Republicans initially argued families that pay no income taxes shouldn't get a payment from the government. Breaking with her party, Snowe said many of those families pay payroll taxes used to fund Social Security and Medicare retirement programs. Many of those families already receive an earned income tax credit that increases based on the number of children in the family that is intended to offset that tax burden. The final agreement drops provisions that would offset its revenue effects by adopting a ban on accounting techniques such as those used by Enron Corp. to avoid paying U.S. taxes. Families with income less than $26,625 were excluded from the tax law, Democrats say, to accommodate reductions in capital gains and dividends taxes, most of which benefit high-income investors. Grassley said the provision was omitted because of ``disjointed discussion and decision-making'' among himself, House Ways and Means Committee Chairman Bill Thomas and Vice President Dick Cheney. Last Updated: June 5, 2003 18:22 EDT quote.bloomberg.com