Office of Management and Budget Director David Stockman told the House Budget Committee yesterday that President Reagan veto a tax bill that makes cuts in only one year.
It was not immediately clear whether the president had authorized Stockman to make the veto threat, which intensifies the administration's fight to win congressional support for its tax plan. But Stockman, through a spokesman, later stressed that a veto of a one-year bill was "the clear working assumption within the administration.
The chairman of the influential House Ways and Means Committee, Rep. Dan Rostenkowski (D-ILL.), warned Wednesday that the House would not pass the three yearly, across-the-board cuts in personal tax rates proposed by the president. Last night he said, "That's too bad, that's too; bad" when told of Stockman's comment.
Treasury Secretary Donald T. Regan, who is the Cabinet member responsible for the tax proposals, had earlier stopped short of threatening to recommend a veto if Congress passed a very different tax bill from that proposed by the president. Regan said in a press conference called Wednesday to answer Rostenkowski that it would damage the economy to have a different bill but that it was too soon to talk of vetoing a bill.
The president clearly is determined to fight hard for his original tax bill which would cut marginal rates across the board by 30 percent over three years. But congressional sources beleive that it is very unlikely that such a bill could pass the House and that its chances in the Senate are also not good. However, if the president backed off soon, that would be a disaster, one Republican commentated.
Republicans on the Ways and Means Committee are meeting the president at 10 this morning to discuss the tax plan and tactics on the bill.
Rep. Barber Conable (R-N.Y.), ranking minority member on the House Ways and Means Committee, saw the president yesterday. He said Reagan remains "disinclined to compromise" over his tax proposals. Conable said he told Reagan of the "somewhat grim" prospects in the committee for the three-year, across-the-board cuts in personal tax rates.
Rostenkowski told reporters Wednesday that he hoped to draft a consensus one-year bill in the taswriting committee and that Congress was not in the mood for a long-range tax bill, which would tie its hands in later years. Some Democrats also believe that Republican enthusiasm for the president's proposals is limited.
But Conable yesterday said he would "do my duty" in pushing for the across-the-board cuts wanted by the president. A vote on the issue is likely during the early stages of the Ways and Means markup on a tax bill, according to congressional sources. This would enable Republicans to record their support for the administration proposals but then go on to work with the Democratic majority to fashion a compromise bill.
The president told Conable that since there was a long road ahead, with many turns to come, it would be a mistake to start to back away from his own proposals this soon.