TAXES: Can the Middle Class Expect Some Relief?
Democrats have promised to tackle the alternative minimum tax.
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Democrats have pledged "fiscal discipline," starting with pay-as-you-go rules to prohibit the House from approving new spending or tax measures unless the costs are offset by tax increases or spending cuts.
"There's not going to be, frankly, room for some grand new adventure in federal spending," said Rep. Earl Pomeroy (D-N.D.), a member of the House Ways and Means Committee.
Still, there's plenty on the Democratic wish list, starting with relief for the growing number of middle-class families hit by the alternative minimum tax, which jacks up their tax bills. Rep. Charles B. Rangel (D-N.Y.), likely to be the next Ways and Means chairman, said yesterday that "tackling this very complex problem would be a good test of bipartisanship."
Rangel said he would not roll back tax cuts that President Bush won from the Republican Congress. But budget experts predict that Democrats will revisit at least some of them, such as lower rates for the richest Americans, lower rates on capital gains and dividends, and partial repeal of the estate tax, to pay for other priorities.
On the growing costs of programs such as Social Security, Medicare and Medicaid, Rangel said he would work with the administration. But political analysts say reform of those programs is unlikely until after the 2008 presidential election.
-- Lori Montgomery
