WATCHING WASHINGTON CLOSE VOTE DUE ON BTU TAX

With Patrick Crow Although the vote could be close, the Senate is expected to pass its version of President Clinton's $500 billion deficit reduction bill. And anticipating passage, the Clinton administration is beginning to show its preference for the BTU tax in a bill passed by the House. The Senate finance committee chose a 4.3cts/gal gasoline tax increase rather than a BTU tax. A House-Senate conference committee will meet in July to merge the bills and decide on the energy tax

June 28, 1993

3 min read

Although the vote could be close, the Senate is expected to pass its version of President Clinton's $500 billion deficit reduction bill.

And anticipating passage, the Clinton administration is beginning to show its preference for the BTU tax in a bill passed by the House.

GASOLINE TAX

The Senate finance committee chose a 4.3cts/gal gasoline tax increase rather than a BTU tax. A House-Senate conference committee will meet in July to merge the bills and decide on the energy tax mechanism.

Republicans may try to kill the gasoline tax through an amendment on the Senate floor. But Sen. Bob Dole (R-Kan.), the minority leader, concedes the bill will pass, and the major battle will be in the conference committee.

Because Democratic leaders will name a majority of the conference committee members, they can select congressmen who favor the BTU tax.

Meanwhile, Clinton administration officials are dropping more hints that the BTU tax is only dormant-not dead.

Mack McLarty, White House chief of staff, told reporters, "The president liked the BTU tax. Let's see how it comes out in conference. That's why the House version will be very important in conference."

And Leon Panetta, director of the Office of Management and Budget, said the BTU tax may be revived when the conference combines "the best of both versions" of the bills.

Among those opposing the BTU tax is the American Energy Alliance, a coalition of more than 2,000 companies, associations, farm groups, and consumer organizations.

Richard Lesher, U.S. Chamber of Commerce president, said, "The only conclusion that the alliance can draw from all the actions and statements (of administration officials) is that the BTU tax is certainly not dead.

"We urge Congress to concentrate their energy on finding ways to reduce the deficit through further spending cuts and hope they will abandon attempts to find backdoor ways to revive a fuels-content tax the people clearly understand is inequitable and damaging to the nation's economic health.

TAX OPPOSITION

Jerry Jasinowski, president of the National Association of Manufacturers and alliance chairman, said, "Apparently the president doesn't understand that opposition to the BTU tax is not based on politics.

"It's based on the understanding of Americans everywhere that the tax will destroy hundreds of thousands of jobs, impose an unfair burden on middle income taxpayers and retirees living on fixed incomes, and contribute little to deficit reduction.

"We're advising all of our members to beware of the return of the BTU tax or any disguised version that may appear during closed door deliberations of the conference committee."