Tax Relief, Simplification, and Equity Act of 2003
TAX RELIEF, SIMPLIFICATION, AND EQUITY ACT OF 2003
The PRESIDING OFFICER. Under the previous order, the clerk will report H.R. 1308.
The legislative clerk read as follows:
A bill (H.R. 1308) to amend the Internal Revenue Code of 1986 to end certain abusive tax practices, to provide tax relief and simplification, and for other purposes.
AMENDMENT NO. 862
(Purpose: In the nature of a substitute)
Mr. GRASSLEY. I send an amendment to the desk and ask for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:
The Senator from Ohio [Mr. Grassley], for himself, Mrs. Lincoln, Ms. Snowe, Mr. Baucus, Mr. Voinovich, Ms. Murkowski, Mr. Warner, Mr. Stevens, and Ms. Landrieu, proposes an amendment numbered 862.
Mr. GRASSLEY. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
(The amendment is printed in today's RECORD under "Text of Amendments.")
Mr. GRASSLEY. I am pleased to join my distinguished ranking member, Senator Baucus, in the agreement we have reached on the child tax credit. I wish to take a minute to fill in my colleagues on how we are at this place at this time on another tax bill.
In the Finance Committee in the year 2001, Senator Snowe and Senator Lincoln added a refundable formula to enhance the child tax credit. This provision lasted through conference. The formula was increased to 15 percent in 2005. President Bush proposed to accelerate the $1,000 tax credit amount but did not accelerate the refundability formula.
In the Finance Committee, we accelerated the refundability formula. Unfortunately, that provision was dropped in conference. At that disappointing moment and at times since, I have indicated that I would like to revive that formula. I was joined by several Finance Committee members and both leaders in attempting to resolve this problem.
I am pleased to say this agreement moves the ball on the marriage penalty and the child tax credit. The relief is small but a start in addressing yet another marriage penalty.
I applaud Senator Kay Bailey Hutchison for her steadfast interest in resolving this other marriage penalty provision.
Finally, our agreement is offset with an extension of customs fees, user fees. I urge the House to respond on our action today.
I would like to get the bill to the President. This will ensure that low-income families get the checks we expect to get out in the next few months that are related to the tax bill that the President signed last week. Without this additional provision we are working on now, we would have families who get an increase in the child credit of $400 per child get a check this summer, but we would not get checks to people who are entitled to the usual refundability because it was not extended.
I would like to do a lot more on the child tax credit. Families should be able to rely on permanent tax relief. That is what the bill I introduced didnot this compromise before the Senate. That is close to what the Senate growth bill did. That is what we should do in the upcoming process on this legislation.
I hope we resolve the refundability formula. We address the marriage penalty and the child tax credit and we make progress on the longer term child tax credit. We simplify the definition of a child. This last measure is the principal recommended simplification of the Tax Code for individuals. This recommendation comes from the Joint Committee on Taxation and the Treasury Department and is something that should have been done a long time ago.
Today we make some major progress on simplifying the Tax Code. Of course, we need to do a lot more. This is what we do as we try to move forward on various pieces of legislation from the Finance Committee.
In this bill we are also going to help those serving in the Armed Forces overseas. Because some of their remuneration is not considered income, they would not benefit from the child tax refund the same way as other people who are not in a war zone. We ought to change that and do change it so everybody is treated fairly.
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Mrs. HUTCHISON. Mr. President, I am certainly going to support this bill and this vehicle. But I did hold it up for a few hours because I am concerned that we are not able to put marriage penalty relief in a permanent position on this bill. However, I have an agreement with the majority leader that he will bring it up this year. Working with the distinguished chairman of the committee, and hopefully with the ranking member, we must fix the marriage penalty.
What we have today is a situation in which we relieve the marriage penalty for 2 years, then for 4 years it comes back, then 2 years later it goes away, and then it comes back for good. This is outrageous. Our married couples do not need a rubber band; they need a Band-Aid. They need to be able to know that when they get married, it is not going to cost them $1,200 a year.
Two Navy lieutenants will lose more than $1,500 a year if the marriage penalty goes away in 2 years; two Army warrant officers will lose $852 a year. This is not right. I have the commitment from leadership that we will take up a bill this year that fixes this inequity, and I hope there will be a bipartisan effort. We cannot let people be unsure about their marriage penalty relief.
I thank the distinguished chairman of the Finance Committee and ask him if he will work with me to ensure that we take this up this year so we can get on and fix the child tax credit. Next on the agenda I hope will be marriage penalty relief.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. Mr. President, I was a party to the conversation with the majority leader and the Senator from Texas. She has accurately stated what was discussed at that meeting. I will try my darnedest to fulfill it.
Mrs. HUTCHISON. Thank you, Mr. President. I appreciate it very much. We will have marriage penalty relief permanent this year. And we will have child tax credit relief permanent, I hope, in the very near future.
Mr. President, I yield the floor.