The tax-writing House Ways and Means Committee has indicated that it is prepared to vote for a tax increase next fiscal year of about $8 billion, far below the $30 billion rise included in the new Democratic budget put forward by House leaders Tuesday.
That is one of several indications that the Democratic budget, even if it survives some initial symbolic tests in the House, will not be voted into law.
The Democratic budget would not cut domestic spending as much as President Reagan's budget would, but would leave a smaller deficit, partly because of the contemplated tax increase plus a smaller defense buildup than Reagan has proposed.
As a practical matter a $30 billion tax increase would require repeal of the 10 percent income tax rate cut scheduled for July 1. Rep. Dan Rostenkowski (D-Ill.), chairman of Ways and Means, said that "politically" an implicit endorsement of a repeal of the tax rate cut is "the worst position for us to be in."
"I'm not bound by any of the suggestions" in the budget resolution, he said.
Ways and Means reported to the House Budget Committee on Tuesday, the same day the Budget Committee came up with its resolution, that a realistic revenue-raising target for 1984 would be $8 billion. That is "a signal to our friends on the Budget Committee what is doable," Rostenkowski said.
Members of the Ways and Means Committee and the Democratic leadership say they believe that the final tax-raising target to be approved by Congress will be in the range of $11 billion to $15 billion for 1984.
What all sides are doing, in part, is positioning themselves both with the voters and for a long legislative bargaining process. The Democratic budget, with Rostenkowski the only notable dissenter among the leadership, is part of a three-part strategy: to come up with a plan that at least 218 Democrats will support, so it can pass the House; to establish a bargaining position with the GOP-controlled Senate and to produce a document affirming party principles.
"In terms of the House, it is a statement of our principles as a party," Rep. Leon E. Panetta (D-Calif.), a senior member of the Budget Committee, said. "Secondly, the reality will emerge out of a House-Senate conference and you've got to be able to establish this bargaining position."
"This is the best we can come up with to define where the Democratic center of gravity is," Rep. Les Aspin (D-Wis.), another Budget Committee member, said.
In the Democratic budget, about half the theoretical $30 billion tax increase is used to finance job and education programs favored by the party's liberal wing and the so-called Atari Democrats who see high technology as the hope for the future and want to support it.
Much of the rest would be used to keep the deficit to $174 billion, lower than the $189 billion in the Reagan budget. This, in turn, is designed to appeal to conservatives.
Finally, the Democratic budget calls for the restoration of a number of cuts in social programs for the poor, including food stamps, Medicaid and welfare, along with rejection of all new administration proposals to cut such programs.
At a House Budget Committee meeting, Rep. Jack Kemp (R-N.Y.) accused Democrats of "asking us to raise taxes on the wage earners. You are trying to stick it to the wage earners."
He was joined by Rep. Tom Loeffler (R-Tex.), who said: "You are trying to reinstate the same old policy of tax and tax and spend and spend again. I find it absolutely absurd that you say we'll do better . . . by raising taxes."
In a separate floor speech Rep. Robert H. Michel (R-Ill.), the minority leader, said, "What we are going to get . . . is a fiscal feathering of the Democratic nest and economic politicking at the expense of recovery."