GOP Plan Said to Cut Taxes of Affluent : Budget: New proposal reportedly would raise levies on those making less than $50,000 and includes a capital gains cut. The Democrats reject it.

Republicans at the budget summit talks Thursday proposed a new tax package that would reduce taxes significantly for persons with incomes over $100,000 and raise them slightly for persons making under $50,000, according to a source close to the bargaining.

Democrats termed it unacceptable and indicated that the offer had set back hopes for swift agreement on a package to cut the deficit by $500 billion between now and 1995.

GOP negotiators proposed a cut in the capital gains tax and other measures that would reduce revenues by about $44 billion over the next five years. But they offered tax increases totaling $121 billion in that period, to slice the federal deficit by almost $77 billion, the source said.

Earlier reports from the talks, which were in their seventh day at Andrews Air Force Base, indicated that both sides had agreed to raise $130 billion through tax increases in the next half-decade.

The Republicans suggested a limit of $10,000 on federal income tax deductions for state and local taxes, to raise $35 billion between now and 1995. California and New York lawmakers have already threatened to vote against the deficit-cutting package if it includes limits on such deductions.

In addition, the source said, the GOP tax-increase package included these other items, together with their five-year revenue gains:

Airline ticket taxes. $11.8 billion.

Requiring all state and local government employes to take part in Medicare and Social Security programs. $11.7 billion.

Alcohol taxes. $24 billion.

Luxury taxes. $9 billion.

Indexing excise taxes to the rate of inflation. $12.9 billion.

Petroleum taxes. $7 billion.

Unspecified user fees. $9.9 billion.

In addition to reducing capital gains taxes--a proposal strongly favored by President Bush and nearly all Republicans and some Democrats--the GOP team proposed incentives for oil and gas production, expanded child care tax credits, extension of research and development tax breaks and a new family savings plan along the lines of existing individual retirement accounts.

An analysis by the staff of the Joint Committee on Taxation, a respected group of technicians working for Congress, indicated that adoption of the GOP package would favor those in the higher income groups, the source said.

According to the study, it would reduce taxes by $7.4 billion for those making $200,000 a year or more, giving them a 5.5% cut in tax liability.

Taxes would be lowered by $2.9 billion for those in the $100,000 to $200,000 bracket, slicing their share of federal taxes to 11.8% from 12.1%, the analysis indicated.

Those with incomes between $75,000 and $100,000 a year would get a total tax reduction of $600 million, and those in the $50,000 to $75,000 category together would get a $100-million tax cut, the study showed.

But people in lower income groups would pay more taxes if the Republican plan were enacted, according to the taxation committee.

Those with incomes under $10,000 a year would have to pay $400 million more in the first year, the analysis said--representing a 2.6% increase in tax liability.

The biggest increases--$1.4 billion each--would be felt by those in the $20,000 to $30,000 bracket and the $30,000 to $40,000 bracket, the analysis said. The tax liability increase for those in the former category would be 1.4% and for those in the latter category, 1.2%.

An increase of $800 million--or 0.9%--would fall on those in the $40,000 to $50,000 category.

Democrats have complained in the past that Bush’s tax proposals would put the greatest burden on those less able to pay and confer a windfall on the richest Americans. Party leaders in both the House and Senate have made it clear that they regard tax equity as a key element in the deficit reduction package that Congress is expected to adopt this month.