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Senate Reaches Tax Compromise, but Issue Still Under Dispute in House

Key Senators have reached a deal on providing more tax relief to low-income families, moving the issue to the House, where it was the cause of considerable consternation on the floor Thursday.

Sen. Blanche Lincoln (D-Ark.), the original architect of a provision to refund money to lower-income families that was dropped from the recently enacted tax package, joined Finance Chairman Chuck Grassley (R-Iowa) and others in announcing that they reached a compromise enabling them to bring a bill to the floor Thursday.

In forming the final bill, Grassley, Lincoln and a third co-author, Sen. Olympia Snowe (R-Maine), melded their dueling proposals to resuscitate the spiked provision.

Democrats have been blasting Republicans for ignoring the working poor ever since Republican negotiators dropped the provision from the $350 billion tax package passed last month.

Democrats have argued that families making between $10,500 and $26,625 will not benefit from the latest round of tax cuts as much as wealthier families because the child tax credit will not be extended to them in the form of a Treasury rebate check.

Republicans, such as House Majority Leader Tom DeLay (R-Texas), have said the package was geared at reducing the burden on those families who pay income taxes, not giving refunds to families without tax liability.

But with Grassley saying he expected the Senate to adopt the measure under unanimous consent as early as Thursday, the pressure will be on the House to respond. So far, DeLay does not seem willing to budge.

Speaking from the floor, DeLay questioned the need for such a bill.

“Thirteen million families have had their entire tax liability eliminated [already],” he said.

If the Senate passes its bill “the Ways and Means Committee can certainly take that under advisement,” he said, making no promise to call up the Senate version.

“The notion that [Republicans] are not taking care of working families is [false],” he said, adding that there will be at least “two or three” more chances for Congress to cut taxes further this year.

DeLay has previously said he would only consider such a provision as part of a broader tax package.

That did not sit well with House Democrats, who showed their displeasure by causing a procedural ruckus during floor action Thursday.

They have been trying unsuccessfully all week to use procedural maneuvering to force DeLay to bring up their bill, which would give a refund to families in the aforementioned income bracket and offset the $3.5 billion cost by curbing corporate tax shelters.

After they failed to derail votes on other legislation Thursday in order to move the bill, authored by Ways and Means ranking member Charlie Rangel (D-N.Y.), DeLay took to the floor.

“My, my my. What a heated debate we have here today,” DeLay began.

He then went into his explanation of why Rangel’s bill is unnecessary.

That prompted Rangel to rise in protest, but DeLay left before Rangel spoke — a move that angered the gravel-voiced New Yorker.

Rangel accused the Republican leadership of arrogance and said Members should remain on the floor to listen to one another.

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