President Carter's new tax and spending proposals appear to have reduced the chances of a tax-cut bill being enacted by Congress this year.
It now seems very unlikely that a bill will be approved before the election, although some supporters of an early move to cut taxes still believe that measures may get passed after the election but before the end of the year.
The president and some key House Democrats have strongly opposed congressional action on a bill before the Nov. 4 election. The president last week said that he would not sign a tax bill before the election and would wait until next year to send Congress his tax proposals.
Rep. Sam Gibbons (D-Fla.), a member of the House Ways and Means Committee who is pushing for a tax bill this year, said yesterday that the president's statement slows things down.
However, there is still some impetus within Congress for action on a tax proposal this year. It is less than two weeks since the Senate Finance Committee approved by an overwhelming majority a bill to cut taxes next year by $40 billion. Senate Majority Leader Robert C. Byrd (D-W.Va.) told reporters yesterday, "I would not rule out a tax measure" in the Senate, but he added that he did not see "Congress enacting a tax cut before the election."
Carter's proposals were markedly different than those agreed by the Senate Finance Committee, This widens the scope for disagreements over just how a tax-cut bill for next year should be drawn up, and makes it more likely that there would be time-consuming discussions within and between House and Senate over the contents of a bill.
With Congress scheduled to recess for the election in early October, there is already very little time for consideration of a major tax-cut bill. One proponent of a bill this year, Rep. Barber Conable (R-N.Y.), has said that time is running out for one to be approved before the election.
But Sen. Lloyd Bentsen (D-Texas), also a strong supporter of a bill this year and a Finance panel member, said yesterday he thought there was a "reasonable" chance that Congress this year would approve a bill which the President would sign. But he "certainly" did not expect it to go through before the election, he added.
House Ways and Means Committee Chairman Al Ullman (D-Ore.) has argued against a tax cut bill this year and so far has not moved his committee towards marking up a bill. He has agreed however that the panel should meet by the middle of the month to consider whether to proceed with drawing up its own plan. He said after Carter's statement that he agreed with postponing action.