Dole Wants New Taxes in Budget Plan Cut Heavily

As a deeply divided Senate made little progress Tuesday in its struggle to put together a budget, Senate Majority Leader Bob Dole (R-Kan.) predicted that the amount of new taxes in the plan probably would have to be cut from the $19 billion now under consideration to no more than $12 billion if it is to win support from a majority of Republicans.

That amount still would be double the relatively modest new revenues requested by President Reagan in his budget proposal. In a letter to Dole that was dated last Thursday and released Tuesday, Reagan again denounced the Republican-led Senate Budget Committee’s spending plan, which is now before the full Senate, as “totally unacceptable.”

Can Veto Tax Bills

Although the President does not have the power to block the budget resolution itself, he can veto the subsequent spending and tax bills that would carry out the broad mandates spelled out in the resolution.

Almost half the Senate’s Republican majority has gone on record as opposing the plan, citing the same objections as Reagan: They say it contains too much in taxes and too little in defense spending. The committee plan would allow defense to grow less than 3% next year--not enough, critics say, to keep ahead of inflation.

Dole, who is conducting a series of private meetings, expressed hope that he could develop a new package within the next few days, but Budget Committee Chairman Pete V. Domenici (R-N.M.) told reporters that “we’re a long way” from a compromise.

Key senators said they are looking at a number of other options, including scaling back the Social Security cost-of-living increase that they had hoped to give this year. Although the law would require no increase if inflation continues below 3%, many had anticipated hiking benefits by about that amount anyway, a move that would win support from the elderly in an election year.

Drug Funds Voted

In floor action, the Senate approved an amendment by Sens. James Abdnor (R-S.D.) and Dennis DeConcini (D-Ariz.) that would add about $200 million to the amount included in the budget committee plan for fighting drug trafficking. The initial costs would be paid by reducing foreign aid by about $168 million.

Sen. Pete Wilson (R-Calif.) plans to put forward an amendment today that would transfer $277.5 million earmarked in the resolution for congressional newsletters to research on AIDS and Alzheimer’s disease. The senator who leads the list of spending on congressional mailings is fellow Californian, Democrat Alan Cranston, who is up for reelection, but Wilson aides insist there is no link.