Reagan Will Lead Tax Reform Fight--Baker

President Reagan will be “leading the charge” for tax-reform legislation this year, Treasury Secretary James A. Baker III pledged Wednesday, although he repeatedly refused to tell a skeptical House committee what specific changes the Administration will seek.

At the same time, in the first signs of business backing for tax reform, an influential group of business leaders joined a bipartisan drive for a simplified tax code with lower rates.

“The news is that, for the first time, a group of business people are clearly behind the reform of tax policy,” Sen. Bill Bradley of New Jersey, co-sponsor of the major Democratic tax measure, declared jubilantly.

Baker told the House Ways and Means Committee: “We want to accomplish tax reform, and we want to do it this year.” But he brushed aside inquiries about specific tax issues, saying that the Administration will give Congress detailed proposals in May.

The Treasury secretary emphasized that the Administration now refuses to support any general blueprint for tax reform--including the Treasury Department’s own detailed plan, issued last November.

An irritated Rep. J. J. Pickle (D-Tex.) charged that the Administration is “waltzing around” and admonished Baker for discussing only a general notion of tax reform.

“That’s not enough, Mr. Secretary,” Pickle said. “You can’t take it home and sell it to the public.”

Gazing around the hearing room, which was jammed with a standing-room-only crowd of lobbyists and journalists, committee Chairman Dan Rostenkowski (D-Ill.) observed: “Enacting a sweeping tax-reform bill means stepping on a lot of big feet.”

Rostenkowski added: “President Reagan must take the heat with the rest of us. A list of lofty principles is not enough.”

But Baker restricted himself to enunciating the basic tenets of tax reform as viewed by the President:

- Lower rates for corporations and individuals, with a top individual rate of 35% or less.

- Retention of the deduction for home mortgage interest.

- Elimination of income taxes for people living at or near the poverty line.

- No tax increase.

Tax reform would eliminate many popular provisions, Baker acknowledged. “We cannot give in to special interests bent upon retaining particular exemptions, deductions or credits and still have significantly lower tax rates,” he said.

The 11 business leaders, representing fields from groceries to high technology, announced their support for tax reform at a news conference called by Bradley; his co-sponsor, Rep. Richard A. Gephardt (D-Mo.); Rep. Jack Kemp (R-N.Y.), and Sen. Robert W. Kasten Jr. (R-Wis.) Kemp and Kasten are co-sponsors of the primary Republican tax-reform measure.

K mart Corp. Chairman Robert Dewar, noting the giant retailer’s 44% tax rate, said his company strongly favors efforts to achieve tax “equity” among businesses.

Similarly, Byron Allumbaugh, chairman of Ralphs Grocery Co. and chairman of the Food Marketing Institute, asked: “Why should some firms pay 5% and people like us pay 45%?”

Other participants said they would back drastic revisions in the tax code even at the temporary expense of their own businesses.

Robert N. Noyce, vice chairman of Intel Corp., a Santa Clara, Calif., company, and George Scalise, vice president of Advanced Micro Devices Inc. of Sunnyvale, Calif., said their companies would pay higher taxes if reform legislation is enacted--but, Noyce emphasized, the nation’s economy as a whole would be enhanced.

And Dartmouth College President David McLaughlin, saying the college may lose some donations if charitable tax deductions are restricted, observed: “We still have to look at the overview and say what is good for the country.”