Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: MONDAY, January 25, 1993 TAG: 9301250089
SECTION: NATIONAL/INTERNATIONAL PAGE: A-1 EDITION: METRO
SOURCE: From The Washington Post and Knight-Ridder/Tribune
DATELINE: WASHINGTON LENGTH: Medium
ENERGY-TAX PLAN STUDIED
The Clinton administration plans to impose new taxes on consumption and is looking favorably at a broad-based energy tax, Treasury Secretary Lloyd Bentsen said Sunday."What you're going to see . . . is some consumption tax is going to take place," Bentsen said, adding that economists believe "we have to do things to cut back on consumption and encourage investment for the creation of jobs in our country."
Bentsen also all but buried any lingering hope that Clinton will stand by his campaign pledge to cut taxes on the middle class, and also downplayed expectations for expanded tax breaks for Individual Retirement Accounts, a cause he championed as a senator.
Speaking on NBC's "Meet the Press," Bentsen left no doubt that Clinton's most important economic goal is to reduce the mammoth federal budget deficits and stressed that an important element of that effort will be raising taxes on consumption.
Bentsen dismissed the idea of a national sales tax but said proposals to increase taxes on Social Security and Medicare benefits remain "on the table," as do proposals to raise excise taxes on sales of tobacco and alcohol.
In addition, he reaffirmed that the income tax rate on families making more than $200,000 "will go up," but declined to say if it might rise higher than the 36 percent target Clinton cited during his campaign. The top rate now is 31 percent.
An energy tax would raise revenue and encourage conservation and reduce the nation's reliance on imported oil, Bentsen said.
"Let me say that what you're seeing in every other major industrial country of the world [is] more conservation practices insofar as taxes added to energy than we're doing in this country," Bentsen said.
Clinton is searching for ways to cut spending and raise taxes as he juggles two potentially conflicting goals: cutting the federal budget deficit and increasing spending on items such as education and public works projects.
Consumption taxes come in many forms: energy tax; sales tax; a variation of the sales tax known as a value added tax, which taxes goods and services at each stage of the production and distribution process; and an excise tax, which targets specific products.