Partisan Fight May Stall Bush Tax Plan : Economy: Congress takes up proposal today. Democrats want their own version, and are prepared to hold up President’s bill.

Congress begins work on President Bush’s election-year tax-cut bill today amid signs that the package already may have become mired in partisan wrangling that could place it in jeopardy.

Bush proposed a 49-point tax-cut plan last month, urging Congress to pass seven “short-term” provisions--including a cut in capital gains tax rates--by March 20 on grounds that the measures are needed to spur the economy.

Acting on a pledge by Democratic congressional leaders, the House Ways and Means Committee begins considering Bush’s plan formally today, aiming to push it through as early as next week. And the Senate Finance Committee has scheduled a drafting session for Feb. 25.

But the package already has become enmeshed in procedural infighting that threatens to pit liberals against conservative Democrats--and Democrats against Republicans--in a battle over which version should prevail, the Administration’s or a still-unwritten Democratic substitute.

Part of the reason that Bush sought to separate the short-term provisions is that they could be enacted without violating the 1990 budget accord, which requires that lost revenue be made up by offsetting spending cuts or tax increases before the full 49-point plan is passed.

But House Democratic leaders, seeking to throw a monkey wrench into the process, have laid out a strategy that calls for sending Bush’s full 49-point plan to the House floor, where it could be held up on procedural grounds.

The Democrats then would write their own version of the plan, expanding the modest middle-class tax cut proposed by Bush and possibly increasing the tax burden for the rich. Their hope is that Bush would be forced to veto his own legislation.

The Ways and Means panel is expected to begin carrying out that strategy today, sending Bush’s original package to the floor and then recessing to allow Democrats to meet in closed-door caucus to draft a substitute.

House Majority Leader Richard A. Gephardt (D-Mo.) introduced the Bush plan Tuesday. He said that he disagrees with the substance of the proposal but wants to get it on the table out of respect for the President’s “call to action.”

Bush warned that he would fight the Democratic strategy.

At the same time, White House spokesman Marlin Fitzwater indicated that the Administration would try to negotiate a compromise.

But Rep. Bill Archer (R-Tex.), the panel’s ranking Republican, called the Democrats’ move “congressional chicanery” and charged that Democrats are trying to ensnare Bush in “a political trap.”

And some of the panel’s Democrats suggested that the House Democratic leadership may have difficulty winning backing for all its own provisions, particularly their push to enact a middle-class tax cut and to reduce Bush’s proposal for cutting capital gains taxes.

Rep. Don J. Pease (D-Ohio) said Tuesday that he and several other Democrats are dubious about such a plan because they are skeptical about whether it is needed and fearful that it would increase the federal budget deficit unnecessarily.

It still is not clear what form the Democrats’ proposed middle-income tax cut would take. Some Democrats have proposed simply enlarging Bush’s plan for increasing the personal exemption for children. Others want to enact a tax credit for middle-income Americans.

Bush’s initial package would include a $500-per-child increase in the personal exemption, a $5,000 tax credit for first-time home buyers, an expanded individual retirement account, a reduction in the top tax rate on capital gains and faster write-offs for business investment.