Senate Approves Tax Cut
Senators approved the plan in a 62 to 38 vote, with 12 moderate Democrats and all 50 Republicans supporting the measure.
Today’s passage follows several days of contentious debate, during which Democrats made dozens of unsuccessful attempts to amend the plan.
In the end, the core of President Bush’s original plan remains intact. The plan reduces the “marriage penalty” tax on two-income couples, gradually repeals the estate tax and doubles the $500 child tax credit.
The bill also lowers the tax rate in the top bracket from 39.6 percent to 36 percent. President Bush had originally sought a reduction to 33 percent.
The Senate’s plan differs from Mr. Bush’s in the size of the cut, lowered to $1.35 trillion from the president’s $1.6 trillion, as well as its timeline, increased from 10 to 11 years.
Republicans applauded the measure — the largest tax cut since 1981 — as a way to return the budget surplus to the people. Democrats say the bill is slanted to benefit the wealthy and will siphon away money that could be spent on federal programs such as education.
The House version, passed May 9, differs from the Senate’s plan in how quickly the cuts are phased in, tax allocations for education and changes in tax brackets. A joint House-Senate conference committee will hammer out a final version of the bill.
The process has been called into some question, as lawmakers consider reports that Sen. James Jeffords of Vermont will announce tomorrow his departure from the Republican Party. Such a move could put the Democrats in charge of the Senate. Currently, the body is evenly divided.
Some say a shift in the Senate’s power structure could change the way the committee would deal with the budget plan.
Negotiators in both houses have said they’d like to get the measure to President Bush by the end of the week.