September 22,1999

Roth Urges that a Portion of the Surplus be Reserved for Medicare BBA 97 Changes, AMT and ''Extenders''

WASHINGTON -- In a letter to Majority Leader Lott, Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) urges that approximately $4 billion of the FY 2000 on-budget surplus be reserved for the extension of expiring tax provisions, Alternative Minimum Tax (AMT) relief, and  the first year costs of adjustments to the Medicare Balanced Budget Act of 1997.

Identical letters were sent to Senate Budget Committee Chairman Pete Domenici and Senate Appropriations Committee Chairman Ted Stevens.

A copy of the letter is attached.


September 22, 1999

The Honorable Trent Lott
Senate Majority Leader
S-207, The Capitol
Washington, D.C. 20510

Dear Trent:

As we continue to make progress on the appropriations bills for FY 2000, I wanted to alert you to several items that should be addressed this year with regard to the Finance Committee.

As you know, the CBO projected a $14 billion on-budget surplus for fiscal year 2000. In the Taxpayer Refund and Relief Act of 1999, the FY 2000 revenue loss was approximately $4 billion. It is important that this $4 billion amount for FY 2000 be reserved for the following items this fall.

1. Tax Extenders - $2.2 billion. Extension of tax provisions that expired in 1999 must be addressed. My preference is to pass the identical provisions that were included in the conference report to accompany H.R.2488, which included a five year extension of many of the provisions.

2. Alternative Minimum Tax (AMT) - $1 billion. The AMT for individuals should be corrected in order for millions of Americans to take advantage of numerous tax credits such as the $500 per child tax credit, HOPE scholarship credit, and the dependent care tax credit. We promised these benefits to middle income families and we should not let the AMT interfere with these credits. We provided AMT relief for one year in last year's omnibus appropriations bill. We need to extend this relief this year as well.

3. Medicare BBA 97 Changes - $1 to $1.5 billion. Several changes to the Balanced Budget Act of 1997 should be made this fall to alleviate the unintended consequences of certain Medicare provisions of the BBA 97.

I believe it is desirable that these three items be addressed before Congress adjourns for the year. In addition, several trade extenders should be addressed this year such as the GSP and TAA. Also, a minimum wage/small business tax package could be considered. As you may know, a limited number of non-controversial pay-fors are available to offset these items.

My staff and I are available to discuss any of these issues with you in our effort to resolve these Finance Committee matters with regard to trade, tax and Medicare needs.

Sincerely,

William V. Roth, Jr.
Chairman

WVR/jkw