In the final segment of a four-part hearing on possible changes to President Bush’s economic growth proposal, a handful of House Republicans told the Ways and Means Committee on Tuesday what they would add to the president’s plan.
“I hope to maintain the package intact,” said Rep. David Dreier (Calif.), the first of five Republicans to speak. “But there are things we can utilize to make it even better.”
Dreier spoke of his bill, the Investment Tax Incentive Act, which he said would bring reinvigorate individual investors and immediately target capital investment.
“We need to create an incentive to get back to the markets,” Dreier said, adding that the legislation would increase budget receipts by $100 million in the first year.
No Democrats testified because they are united in opposing Bush’s tax-cut plan, which would add to the federal deficit, according to a spokesman for the Ways and Means minority.
“Democrats who oppose the underlying bill won’t wait in line to add their own specific tax breaks to it,” said Dan Maffei.
Although the proposed package would provide many immediate and long-term benefits, there should be an exemption of state and local taxes for residents whose states do not have an income tax, said Rep. Marsha Blackburn (R-Tenn.).
“This is simply an issue of tax fairness,” she said.
Blackburn discussed a bill put forward by Rep. Kevin Brady (R-Texas) that would give taxpayers the option to either deduct state and local income taxes or state and local sales taxes.
“Those living in states that have an income tax would still be able to take an income tax deduction as they do today,” she said.
Rep. Fred Upton (R-Mich.) testified in favor of adding an accelerated depreciation measure he co-wrote with Rep. Jerry Weller (R-Ill.). They believe their plan would help spur growth with the high-tech sector by allowing businesses to depreciate 100 percent of their equipment purchases over the next 18 months.
“From 1994 to 2000, the information technology industry served as an engine. It has now become an anchor because things have been really tough,” Upton said, adding that the president’s plan does not increase small business expending for new investment.