The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“EASING TAX BURDEN FOR ALL AMERICANS” mentioning the U.S. Dept. of Commerce was published in the House of Representatives section on pages H1388-H1389 on April 9, 1997.
The publication is reproduced in full below:
EASING TAX BURDEN FOR ALL AMERICANS
The SPEAKER pro tempore. Under a previous order of the House, the gentleman from Florida [Mr. Stearns] is recognized for 5 minutes.
Mr. STEARNS. Mr. Speaker, I rise today to introduce legislation that would ease the tax burden for all Americans and assist all of us in pursuit of the American dream.
This legislation contains three simple provisions affecting the Tax Code: Indexation of the capital gains tax, establishment of the American dream savings accounts, and repeal of the 1993 increase in taxes on Social Security benefits.
Quite simply, this bill is designed to right several wrong things that I think presently exist in the Tax Code. And I would point out, Mr. Speaker, these three things are offset by reductions in the Department of Commerce and the Department of Energy. Surely the Department of Commerce would appreciate the fact that we are reducing taxes, and so would the Department of Energy. So the important thing about this bill is it is budget neutral.
The legislation addresses capital gains taxation. This type of tax arises when an asset is sold and the difference between the base and the sales price is taxed. The appreciation in value can reflect real or perhaps it can reflect inflationary gain. Because of the uniqueness of this tax, what happens is, people hold an asset for a long period of time, they are taxed, and basically much of that tax is due to inflation.
Put simply, gains should be indexed to account for this inflation, and that is what this bill does. I can give some statistics, which I will make part of the Record, Mr. Speaker, but basically, in real terms, fixing this simple capital gains indexation will increase investments by $75 billion, raise gross domestic product by $120 billion, and reduce the cost of capital by 12 percent, creating an average of 233 additional new jobs.
Best of all, a capital gains tax reduction affects nearly everyone in this country. In fact, nearly 50 percent of those Americans who claim capital gains have incomes of less than $40,000, and 60 percent of those who claim capital gains have incomes of less than $50,000.
The second part of this legislation establishes dream savings accounts to encourage personal responsibility and, frankly, savings. In short, America needs a system that encourages and betters retirement and big-event purchasing savings and does so through these dream savings accounts.
The current system does not provide any incentive at all for Americans to save for their first home or for their children's college education, nor does the current system afford American taxpayers the opportunity to use their retirement savings for catastrophic events. In fact, it can easily be argued that the current system penalizes Americans. We must change that.
The third part of my bill would repeal the tax increases on the Social Security benefits that were enacted in President Clinton's 1993 budget reconciliation bill. Prior to 1993, individuals with income in excess of a certain threshold could be taxed only at half of their Social Security benefits. Recipients with incomes below the threshold were not at all taxed on their Social Security income.
However, after President Clinton's 1993 Omnibus Budget Reconciliation Act had been implemented, higher income thresholds were achieved. Now, individuals earning above these thresholds can be taxed at 85 percent of their Social Security benefits.
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Unfortunately this bill also includes dividends on earnings. Thereby even tax-exempt dividends count as income when calculating Social Security taxation. Simply put, the tax increase in the President's bill is unfair and wrong. It is punitive and hurtful toward our Nation's seniors and should be repealed. The last Congress sent to the President legislation to repeal the Social Security provisions, but the President stood by his original plan and it did not pass. Nevertheless, this issue is not resolved as far as I am concerned. We must address this issue, which is why I have introduced the language in this legislation to repeal the onerous 1993 tax increase on our seniors. This bill is very simple. It does these three things. It is common sense and fair. Simply altering a few necessary portions of our Tax Code, it would help all Americans and give a fair and level playing field. Best of all, every penny in reduced revenue is offset by reductions in the funds available to the Department of Commerce and the Department of Energy. This is a small but important step forward in the debate over our Nation's future. This is legislation we cannot afford to live without.
Mr. Speaker, I urge my colleagues to support this bill. It is imperative for our country's present and future generations that we address these issues today.
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