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American Morning
Cutting Taxes
Aired May 16, 2003 - 07:11 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FREDRICKA WHITFIELD, CNN ANCHOR: Now to the $350 billion tax cut bill that was narrowly passed by the Senate last night. It includes a suspension of the dividend tax that President Bush wanted.
Our congressional correspondent, Jonathan Karl, has the story from Capitol Hill.
(BEGIN VIDEOTAPE)
DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: On this vote, the yeas are 50, the nays are 50. The Senate being equally divided, the vice president votes in the affirmative, and the amendment of the senator from Oklahoma is agreed to.
JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT (voice-over): With a tie-breaking assist from the vice president, Republicans scored a significant, if not complete, victory for the president's economic plan.
SEN. JON KYL (R), ARIZONA: This was a real victory tonight, not only for President Bush and for the Republican Senate and the Finance Committee and the leadership, but of course for the American people.
KARL: The victory comes after President Bush aggressively courted key Democratic senators, especially Ben Nelson of Nebraska. Nelson, however, insists his support has nothing to do with White House pressure.
SEN. BEN NELSON (D), NEBRASKA: I don't mean to in any way to demean the presidency, but it's not about pressure from the White House or anything like that. It's about the contents of the plan, because I think that's what's the most important part of what we're doing here.
KARL: Republicans won Nelson's backing by agreeing to include $20 billion in aid to cash-strapped state and local governments.
The bill would completely eliminate the tax on dividends, the White House's highest priority. But it took some creative accounting to do that.
SEN. MAX BAUCUS (D), MONTANA: This is a huge yo-yo tax provision. Now you see it, now you don't.
KARL: The dividend cut would last just four years, and the bill includes approximately $90 billion in so-called offsets, effectively tax increases to keep the total cost of the tax cuts at $350 billion. In addition to temporarily eliminating the tax on dividends, the bill would reduce income tax rates, increase the child tax credit, and give small businesses a tax break on new equipment purchases.
(END VIDEOTAPE)
The differences between the Senate bill that was passed last night and one that was much larger passed last week by the House still need to be worked out. But at the end of the process, it is expected that President Bush will be able to sign into law the third-biggest tax increase in history, and an economic plan that includes most but not all of what his priorities and exactly what he asked for, or at least much of what he asked for from the Senate and the Congress -- Fredricka.
WHITFIELD: All right, thanks very much, Jonathan Karl.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com.
Aired May 16, 2003 - 07:11 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FREDRICKA WHITFIELD, CNN ANCHOR: Now to the $350 billion tax cut bill that was narrowly passed by the Senate last night. It includes a suspension of the dividend tax that President Bush wanted.
Our congressional correspondent, Jonathan Karl, has the story from Capitol Hill.
(BEGIN VIDEOTAPE)
DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: On this vote, the yeas are 50, the nays are 50. The Senate being equally divided, the vice president votes in the affirmative, and the amendment of the senator from Oklahoma is agreed to.
JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT (voice-over): With a tie-breaking assist from the vice president, Republicans scored a significant, if not complete, victory for the president's economic plan.
SEN. JON KYL (R), ARIZONA: This was a real victory tonight, not only for President Bush and for the Republican Senate and the Finance Committee and the leadership, but of course for the American people.
KARL: The victory comes after President Bush aggressively courted key Democratic senators, especially Ben Nelson of Nebraska. Nelson, however, insists his support has nothing to do with White House pressure.
SEN. BEN NELSON (D), NEBRASKA: I don't mean to in any way to demean the presidency, but it's not about pressure from the White House or anything like that. It's about the contents of the plan, because I think that's what's the most important part of what we're doing here.
KARL: Republicans won Nelson's backing by agreeing to include $20 billion in aid to cash-strapped state and local governments.
The bill would completely eliminate the tax on dividends, the White House's highest priority. But it took some creative accounting to do that.
SEN. MAX BAUCUS (D), MONTANA: This is a huge yo-yo tax provision. Now you see it, now you don't.
KARL: The dividend cut would last just four years, and the bill includes approximately $90 billion in so-called offsets, effectively tax increases to keep the total cost of the tax cuts at $350 billion. In addition to temporarily eliminating the tax on dividends, the bill would reduce income tax rates, increase the child tax credit, and give small businesses a tax break on new equipment purchases.
(END VIDEOTAPE)
The differences between the Senate bill that was passed last night and one that was much larger passed last week by the House still need to be worked out. But at the end of the process, it is expected that President Bush will be able to sign into law the third-biggest tax increase in history, and an economic plan that includes most but not all of what his priorities and exactly what he asked for, or at least much of what he asked for from the Senate and the Congress -- Fredricka.
WHITFIELD: All right, thanks very much, Jonathan Karl.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com.
