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  •   Gore Offers Targeted Tax Relief Proposal

    By Ceci Connolly
    Washington Post Staff Writer
    Saturday, July 31, 1999; Page A2

    As the Republican-controlled Senate approved its $792 billion tax cut plan yesterday, Vice President Gore muscled in on the debate with a much smaller, more targeted economic proposal of his own.

    In a speech at the Minnesota Community Technical College in Minneapolis, Gore decribed the GOP proposal as a repeat of the "trickle-down tragedies of the past," and said that as president he would push for $250 billion to $295 billion in tax relief for education, married couples and research and development.

    "I think it's crazy to put today's prosperity at risk," he said according to prepared remarks. "I want to keep our prosperity going – by facing up to the tough choices and hard decisions that we are now called upon to make."

    And in what is becoming an almost daily ritual for the Democratic front-runner, Gore aimed his harshest rhetoric at Texas Gov. George W. Bush, who is leading in polls and has endorsed the large tax cuts proposed by congressional Republicans. "Some have breezily said they would just sign the Republican bill into law," Gore said, "rubberstamping some of the worst handiwork of the Republican right, and caving in to the craven demands of the Washington special interests."

    Gore's tax agenda tracks closely with – and in some instances overlaps – existing administration plans. It is notable for its emphasis on savings and targeting assistance to low-income workers – an approach that leaves Gore straddling both ends of the political spectrum.

    "He's hitting the themes of more savings, more personal responsibility, more investment in [one's] own career; that's a conservative message by traditional Democratic Party standards," said Clint Stretch, director of tax policy at Deloitte & Touche. "Then he has the almost liberal message of giving marriage penalty relief for the lowest-income brackets and people receiving the Earned Income Tax Credit."

    Specifically, Gore called for increasing the standard deduction for married couples to twice the amount available for single filers. He would be even more generous to couples earning less than $30,000; they would receive an extra $500 in the EITC.

    Gore reiterated his desire to create a new "401(j)" program, similar to 401(k) accounts, that would allow families to save up to $2,500 annually tax-free for continuing education and training. The vice president also said he would make permanent the tax credit for corporate research and development costs, an expensive but popular proposition.

    "America can have tax cuts that reflect our values and strengthen hard-working families," Gore told the audience of students and elected officials.

    Bush spokeswoman Karen Hughes called Gore's package a "half-hearted effort to reinvent himself. This is, after all, the vice president who cast the tie-breaking vote on the largest tax increase in American history." Gore supported the $241 billion deficit reduction package passed in 1993.

    As a candidate struggling to distinguish himself from the president, Gore pared back on President Clinton's proposed $250 billion "Universal Savings Accounts," which are designed to help low- and middle-income families save for retirement.

    "The vice president advanced the debate by showing that you could have a modified USA account proposal and still make room for other key middle-class tax cuts," said Gene Sperling, director of the White House's National Economic Council.

    Although the vice president did not directly address how he would pay for his tax cuts or mention the $3.6 trillion national debt, aides said that like Clinton, Gore would effectively eliminate that debt as part of his overall strategy for extending the life of Social Security and Medicare.

    Gore also opened the door to further tax-cut proposals, saying, "We should explore the use of the tax code to help with the costs of health care."

    © 1999 The Washington Post Company

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