Tax Reduction

The Senate approved on Friday its own version of a bill providing $85 billion in net tax cuts over the next five years for families, students, home-sellers and investors, sending it to a House-Senate conference committee to find a compromise acceptable to President Clinton.

More than half the deficit reduction that President Reagan will propose for fiscal 1987 will represent recycled proposals that Congress rejected last year, and about 40% will be such new ideas as selling government property and loans, White House Budget Director James C. Miller III told congressional leaders Tuesday. But congressional leaders insisted that Reagan, if his spending cuts are to win approval this year, must drop his opposition to a tax increase.

The Republican-led House began its first full legislative day of the new year by reigniting one of last year's pivotal partisan fights: the debt ceiling debate that helped to define the tea party-powered majority. The House voted largely along party lines Wednesday to deny President Obama an increase in new borrowing authority - a political exercise that is not expected to curtail federal spending or threaten a federal default. The tally was 239 to 176. Because the measure is expected to stall in the Senate, which Democrats control, and is opposed by Obama, it is unlikely to prevent a $1.2-trillion increase in the debt ceiling.

Gov. Pete Wilson has proposed a 15% reduction in California income taxes (Jan. 11). Probably such a reduction would really benefit only about 10% of our citizens. I suggest a reduction for the California state sales tax, now 7.25%, instead of income taxes. This would benefit all of our millions of citizens. Very likely it would give them more funds to use for additional purchases and help business sales. CHARLES L. HAPKE Lone Pine

The Los Angeles County assessor's office announced Monday that it has reduced assessments for 333,000 county homeowners, leading property tax revenue to drop for the first time in recent years. As a result, the county expects to lose about $440 million in property tax revenue, a 1% decrease that county officials had anticipated. "We were worried that it would be a lot higher," L.A. County Assessor Rick Auerbach said.

Under the provisions of Proposition 8, a measure passed by the voters in 1978, property owners who believe they have experienced a decline in value may file an application for a property tax reduction. "We have made the process as simple and direct as possible," said Los Angeles County Assessor Kenneth P. Hahn. "Applications are available at all of our 13 regional offices." Office locations are listed on the back of tax bills or by phoning (213) 974-3211.

Re "Bush Energy Stance Begins to Worry Some in GOP," May 10: The congressional Republicans are very slow to react: The citizens of California have worried and have lived in a crisis situation for more than three months now--a death knell for the California economy? Where are the congressional Republicans lately? The promised tax reduction is becoming a fantasy or mirage, since the calculated annual benefits of $300 to $700 per family are erased or wiped out by the continued greedy and excessive increases by corporations close to President Bush's heart (price increases for gasoline, natural gas, electricity and pharmaceuticals have recently been announced)

Eighteen years ago, Congress and President Reagan enacted a tax reform that tidied up the mess quite a bit. Since then, Congress and presidents of both parties have made a new mess, and President Bush is right that it is time for another cleanup. He has called an economic conference this week to mull over some proposals. The politics may require the lion's share of the mulling. The mechanics of personal income tax reform are straightforward: You end deductions for this, that and the other.

A state court is threatening to cut California's unpopular car tax, but in a way that has even Gov.-elect Arnold Schwarzenegger concerned. As a campaign pledge, Schwarzenegger vowed that upon taking office he would roll back a $4-billion increase in the annual tax residents pay to register their cars and trucks. But he and outgoing Gov.

Pssst. There's a dirty little secret behind the tax cut proposals that the House and Senate will consider this week. They are structured so that their true costs won't become apparent until after 2002, the target year for balancing the federal budget. Thereafter the Treasury will lose increasing billions of dollars in revenues annually just as the baby boomers begin to reach retirement age, contributing less to government coffers and drawing more in Medicare and other benefits.