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Deficit-Cutting Conferees Turn Into Final Lap

December 15, 1987|From the Washington Post

WASHINGTON — Congress moved into the final lap of deficit-cutting Monday as two negotiating teams tackled the job of reducing the 1988 deficit by $30.2 billion.

Relatively few concrete actions were taken by House-Senate conference committees charged with reconciling differing versions of two bills: a $600-billion spending measure and a package of tax increases and spending cuts. But legislators said they sensed a strong desire to finish both tasks by the middle of this week, in order to wrap up the 1987 congressional session considerably before Christmas.

"We are near the conclusion of an enormous task," said Senate Appropriations Committee Chairman John C. Stennis (D-Miss.).

Accept Some Provisions

Tax negotiators agreed to accept $1.8-billion worth of provisions that are identical in the House and Senate bills, including an extension of the 3% tax on telephone service, which otherwise would expire at the end of this year.

Other identical provisions, virtually certain to become law, include denial of the tax credit for child care for the cost of sending a child to overnight camp, imposition of Social Security taxes on employers for tips earned by their employees and imposition of a flat 34% tax rate on "personal service corporations," including certain types of law and other professional firms.

As expected, House tax negotiators agreed to drop $2-billion worth of "sweeteners" and technical tax corrections from their bill to comply with the terms of the deficit-reduction agreement reached last month between congressional leaders and the Reagan Administration. That agreement called for $9 billion in tax increases, but specified that every provision must raise revenue.

Focus on Appropriations

Meanwhile, another group of House and Senate conferees formally began the task of reconciling their differences over a $600-billion omnibus appropriations measure that will fund most government operations through the end of the fiscal year on Sept. 30. However, the real work will not begin until today, when 13 separate subcommittees begin meeting.

The spending bill conference is charged with detailing the discretionary spending cuts needed to trim $7.6 billion from the deficit.

A House Appropriations Committee aide said he expects the spending bill conferees to complete their work as early as Wednesday, which would mean the legislation would be ready for floor action in the House and Senate on Saturday.

That will mean Congress must pass another short-term funding bill, since the current resolution continuing government funding expires Wednesday night.

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