House Ways and Means Committee Chairman Al Ullman (D-Ore.) said yesterday that Congress could use revenues from the Carter administration's proposed crude-oil tax to help reduce Social Security payroll tax deductions.
Adoption of such a plan would help both the administration, which views the crude-oil tax as a key part of its energy proposals and members of Congress, who have come under much pressure to reduce the big Social Security tax increases authorized in December.
"If, indeed, we must do something because of the political pressures, there's one thing that we could do . . . and that is to take a portion of those crude-oil revenues - which we intend to feed back into the economy anyhow - to give us some relief in Social Security," Ullman said yesterday on "Face the Nation" (CBS, WTOP).
Ullman said that neither he nor President Carter was advocating rolling back the Social Security tax increases, major portions of which are scheduled to take effect next year. "I think the president feels the same way that I do - that we should . . . not back off on the Social Security tax," he said.
But he said using revenues from the proposed crude-oil tax would be more acceptable than using general fund monies to subsidize reductions in the Social Security tax.
"My strongest objection is to dipping into general revenues to beef up the Social Security system so you can reduced payroll taxes," he said. "That would be a disaster."
Ullman said that to "dump general revenues" into the Soviet Security trust fund would "open a whole Pandora's box of pressures to increase benefits without any consideration of taxes."
The crude-oil tax proposal was approved last year by the House, but was defeated in the Senate. Ullman said yesterday that the proposal "is very much alive" in the House-Senate conference committee.
Ullman said that without the crude-oil tax "we don't have an energy bill, and I would be opposed to moving forward with the tax provisions of the energy proposal." However, on another question he said he would reluctantly support an oil import fee in lieu of a tax. "But that would create all kinds of inequities and problems . . . that we could eliminate if we move to a crude oil tax," he said.
Suggestions to use possible crude-oil tax revenues to help subsidize Social Security benefits have been quietly circulating around the White House for several days. Ullman said yesterday he is aware that Carter "Strongly supports feeding" such a tax "back into the economy." But "we might have some different views how it should be done," he said.
Ullman added: "My judgment is that if we (Congress) decided to feed it back into the economy through payroll tax deductions, that might be acceptable" to Carter.
House Democrats plan to meet Wednesday to consider proposals for Congress to reduce Social Security taxes.