Most Americans Hit Directly by Levy on Fuels

For most Americans, the only part of the program that will hit their pocketbooks directly is the energy tax to be levied on virtually all fuels, from gasoline to coal to nuclear power.

Administration officials estimate that the new tax will cost the average household between $100 and $150 a year. At roughly $10 a month spread across gasoline prices, heating costs and electric bills, many consumers will barely notice it, the officials hope.

Higher fuel costs to business likely will be passed on to consumers, but the disguised price increases on a variety of manufactured goods should not be burdensome, officials said.

When fully implemented by 1997, the tax will add an estimated 8 cents a gallon to the price of gasoline and boost utility bills by 3% to 4%, industry officials said.

The energy tax will yield an estimated $71.4 billion over the next five years.

The biggest tax burden will be borne by the wealthiest 1.2% of taxpayers, who would supply $126.3 billion in new revenues for the federal Treasury through higher income taxes.

A new tax bracket of 36% would apply to gross income of more than $140,000 for individuals and $180,000 for couples. A surcharge on incomes above $250,000 a year would bring rates on those taxpayers to nearly 40%.

Social Security recipients with incomes above $25,000 for individuals and $32,000 for couples will pay taxes on 85% of their benefits, as opposed to the current 50%. The total take from this new tax is estimated at $21.4 billion over four years.

Families and individuals earning $30,000 a year or less would be insulated from the new taxes through an expanded federal earned-income tax credit.