Reagan Says Yes and No to Budget Tax Hike Bids

President Reagan supports $6.1 billion in new taxes outlined in his $1-trillion budget, but he considers an additional $13 billion proposed by Congress unacceptable, a Treasury Department tax expert said today amid raised eyebrows from members of a House committee.

“The Administration continues to support the $6.1 billion of additional governmental receipts shown in the President’s budget proposal,” Dennis Ross, the department’s tax legislative counsel, told the House Ways and Means Committee.

“The President has made clear his opposition to the budget reconciliation (passed by Congress) and its inclusion of a substantial tax over the next three fiscal years,” he said.

Committee members challenged distinctions between the tax proposals offered by the Administration and those under review by Congress.

“I find it difficult to accept the fact that when you make a recommendation, it’s called revenue enhancement; if we do it, it’s called a tax increase,” objected Rep. J. J. Pickle (D-Tex.). “That appears to be hypocrisy.”

Rep. Byron L. Dorgan (D-N.D.) criticized Reagan for giving the impression that a constitutional amendment to require a balanced budget would solve the current deficit problems. “I find it completely disingenuous for President Reagan to disengage himself from fiscal policy,” Dorgan said. “It almost persuades me to nominate him for an Oscar.”

Ross’s testimony kicked off four days of hearings by the chief House tax-writing panel on proposals to raise more money for the government.

As a starting point, lawmakers have a 291-page list of options, including suggestions to raise taxes on alcohol and tobacco, to assess higher fees on petroleum products and to order new money-raising twists in the federal income tax laws revised just last year.

None of those prospects have sparked enthusiasm, however, and there are no solid predictions of what choices Congress might make eventually.

The goal, outlined in the record $1-trillion budget resolution passed by Congress last month, is to raise $64.3 billion in new funds during the next three years--$19.3 billion in fiscal 1988, which begins Oct. 1, $22 billion in fiscal 1989 and $23 billion in fiscal 1990.

According to the plan, the extra tax money is needed to help run government programs while also cutting the federal deficit by about $37 billion.

But Reagan, who blames Congress for suggesting a tax increase, has promised to veto any new tax package, leaving the House and Senate the challenge of gathering the two-thirds margin in each chamber needed to override him. Partly because of his threats, the issue is more complex than it might have been.

Some members of Congress are seeking to pair the tax hike with restoration of a provision of the Gramm-Rudman balanced budget law that would result in automatic across-the-board spending cuts if Congress and the President fail to meet the sharp deficit reductions required by the law.