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Senate Tax Reform Bill

May 18, 1986

The League of Women Voters of Los Angeles County and Orange County shares the pleased surprise expressed in Times editorials (May 5), "Back Room Magic," and (May 8), "Senate's Lightning Bolt," over the "magical transformation" by which the Senate Finance Committee has revived hopes that comprehensive tax reform will actually be achieved this year.

We agree that there is no perfect tax system. But as the Senate begins debate on the measure that the Finance Committee approved unanimously, we think it's important to keep in mind just how imperfect our present system is. For example:

1--In 1985, the U.S. Treasury took in almost $396 billion in income taxes--and lost more than $365 billion in revenues due to tax loopholes.

2--In 1985, corporations paid only 15% of the total income taxes collected by the federal government; individuals paid 85%.

3--Between 1980 and 1982, the number of families below the poverty line who were required to pay income tax more than doubled.

The Senate committee plan, like the House-adopted proposal endorsed by the league, addresses many of the concerns our members around the nation expressed when we studied the federal tax system last year. While we believe that the proposed treatment of the accelerated depreciation system is far too generous, we support the effort to end the business investment tax credit. We agree with The Times in applauding one of the Senate committee's major achievements--provision of relief for poorer taxpayers.

As the battle is joined on the Senate floor and special interests dig in to preserve their special tax breaks, we should remind ourselves that we, as ordinary taxpayers, make up the largest "special interest" in the nation. It's up to us to let Washington know that we want genuine tax reform now.

The Times aptly described the Senate committee action as a lightning bolt. It's up to us to supply the thunder, in support of real reform, to follow that lightning.

BETTY TROTTER

President

League of Women Voters

of Los Angeles County

JESSICA DEAN

President

League of Women Voters

of Orange County

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