US United Front Cracks Over Tax Cut

by Leroy Baker, Tax-News.com, New York

12 December 2001

Despite efforts from both sides of the political divide in the United States to present some kind of united front in the face of the international fight against terrorism, there are signs that the bipartisan agreement is beginning to fall apart, with key Democrats unable to contain their doubts about the President's signature tax cut any longer.

Following admissions from the Bush administration that the government will be forced to run budget deficits at least until the end of 2004, and that they will seek to increase the limit on government borrowing for the first time in almost five years, Congressional Democrats have laid the blame squarely at the door of the$1.35 trillion tax cut pushed into law in the spring.

'I don't think that there's any question that the deficits have been created in large measure because of the tax cuts that were passed at the insistence of the administration,' Senate Majority Leader Tom Daschle asserted earlier this month.

However, although the majority of House Democrats have backed a proposal to rescind future installments of the tax cut aimed at wealthy families, Senator Daschle has refused to urge serious reconsideration of the issue on the administration, claiming that it would be a wasted effort unless any of the 12 Senate Democrats who supported the measure have changed their position.

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