Pressure Grows to Cut Taxes in '98: Budget Deal Could Shaft If...
As a strong economy continues to drive down the federal deficit, pressure is building in both parties to recast last summerÛªs balanced budget deal to make room for additional tax cuts and domestic spending to gain advantage in the 1998 midterm elections.</br></br>Although the White House has decided against offering any major proposals to cut or simplify taxes in President ClintonÛªs State of the Union address next month and forthcoming budget, a senior administration official said this week all that could change if the deficit picture continues to improve.</br></br>ÛÏWeÛªre not ruling out further steps in tax reform or changes later in the year," said Gene Sperling, head of the White House National Economic Council ÛÏWell look at a number of things, but as always the key issue is how you would pay for it and whether it meets the presidentÛªs guidelines for fairness."</br></br>Republicans, for their part, have resisted until now efforts to change the budget agreement to allow for more spending for highways and GOP priorities. But with the economy continuing to improveÛÓand the election campaign soon upon themÛÓHouse Speaker Newt Gingrich (R-Ga.) and other leaders have begun speculating how they might spend future surpluses. -; Û_,</br></br>Congress and the Clinton administration have plenty of ideas for more spending and tax reliefÛÓincluding elimination of the ÛÏmarriage penaltyÛ for couples who file jointly arid jre-duction in die burden of the payroll taxÛÓin the event the government finds itself within striking distance of a surplus in the coming months.'.