Newspaper article THE JOURNAL RECORD

Congressman Pushes Foir Energy Tax

Newspaper article THE JOURNAL RECORD

Congressman Pushes Foir Energy Tax

Article excerpt

Hearst Newspapers

WASHINGTON _ One of the hardest things for a lawmaker to do is vote for a tax increase. So when the House tax-writing committee took up President Clinton's controversial tax package last week, few members of Congress rushed to praise it.

Even Democrats, who largely support their president's economic agenda, muttered unhappily about parts of the package, particularly the energy provisions.

But Rep. Sander Levin, D-Mich., is one who admits that such a tax is necessary if Clinton is to keep his promise to reduce the federal debt by $500 billion over five years.

Nevertheless, supporting it was a task that the 61-year-old congressman, who has faithfully represented the interests of Michigan's giant auto industry since he was elected in 1982, took on gingerly.

"Nobody likes this tax," he said. "I don't like it. But the question is, can you do serious deficit reduction without an energy tax?"

The proposed tax on the heat content of major fuels could raise nearly $71 billion over five years _ a major revenue source for Clinton's economic plans second only in size to proposed increases in personal income tax on the affluent.

When fully phased in by 1996, the energy tax is estimated to raise gasoline prices by 7.5 cents a gallon and add $2.25 a month to the average electric bill.

The Treasury Department said that for a typical family of four earning $40,000 a year, the total direct and indirect costs of the energy tax would be about $320 a year.

"Nobody said passing a major deficit reduction package would be easy or simple," Levin said. "But if the Btu (British thermal unit) tax were pulled out of it, the whole thing would collapse."

The energy tax under consideration would affect virtually every individual and business in the country, although some existing programs to help the poor would be expanded to soften the bite they would feel from the energy tax, the administration said.

Last Thursday, the tax-writing House Ways and Means Committee, on which Levin sits, rejected an attempt to kill the energy tax. It was a party line vote _ 24 Democrats against, 14 Republicans for killing it.

This week, some Democrats will be seeking exemptions from the Btu tax for home-state interests _ such as natural gas in the Southwest and the agriculture and aluminum industries in the Midwest and Northwest _ setting the stage for more difficult votes for committee members. …

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