Future Tax Cuts Jeopardized by Dems' Budget Proposals

By Nathan Burchfiel | July 7, 2008 | 8:32pm EDT

(CNSNews.com) - If the 2008 budget proposals introduced by Senate Democrats last week are enacted, passing any future tax relief measures would be nearly impossible, because doing so would require a supermajority, Senate Republicans charge.

The 64-page proposal released by Democrats on the Senate Budget Committee serves as a rebuttal to the proposal issued in February by the White House. If passed, the Democrats' version would establish points of order -- Senate rules -- against legislation that would cause or increase a budget deficit or that would reduce a surplus.

The Senate may vote to ignore a point of order with a three-fifths majority or 60 votes.

Under the proposed requirements, the major tax relief plans passed during the Bush administration in 2001 and 2003 would not have passed, because none of them received 60 votes in the Senate. The 2001 tax cut passed with 58 votes, the 2003 cut with 51 votes, and the 2005 renewal of earlier cuts with 54 votes.

"All of that on its face sounds like good legislation," Josh Holmes, a spokesman for Senate Minority Leader Mitch McConnell (R-Ky.), said of the point of order proposals. "But the problem lies in that that current tax policy is sunsetted and is not counted for 10-year budget projections."

Tax cuts are considered a net revenue loss, so they would be subject to the supermajority requirement under the Democrats' proposals, Holmes said. "It would count as lost revenue despite the fact that we've got record tax revenue [from the Bush cuts]."

Waiving a point of order requires 60 votes instead of the usual simple majority of 51. In a Senate as narrowly divided as the current session - with 51 Democrats and 49 Republicans - it is unlikely that any partisan issue would be able to garner 60 votes.

Sen. Jeff Sessions (R-Ala.) proposed an amendment to the budget proposal that would have protected the '01 and '03 tax relief from the supermajority requirement. The amendment was voted down Wednesday.

Also Wednesday, the Senate agreed to an amendment proposed by Sen. Max Baucus (D-Mont.) that would "provide tax relief to middle class families and small businesses and to expand health insurance coverage for children."

Spokesmen for the Democrats on the Budget Committee did not respond to repeated requests for comment Thursday. In a statement issued upon introducing the resolution, Budget Committee Chairman Kent Conrad (D-N.D.) praised the points of order.

Noting that the new rules would apply to "any new mandatory spending or tax cuts," Conrad called the proposal "fiscally responsible."

"While no single budget resolution can solve all of our budget challenges, this plan will begin to put the nation back on a more sound fiscal path," Conrad said. "I believe that is true about this resolution."

If the Democrats' proposal is adopted but they eventually lose control of the Senate, Republicans could revert to the simple majority standard with a simple majority, Holmes said.

"It would take 60 [votes] to do any kind of tax [cut] extension but it would be simple majority to change the rules back," he explained.

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