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RYAN, WAYS AND MEANS COMMITTEE VOTE ON NEW FAMILY TAX RELIEF BILL

WASHINGTON – As a member of the House Ways and Means Committee, First District Congressman Paul Ryan today took part in the markup of a new bill that would deliver significant tax relief to families. The legislation provides tax relief for married couples to counteract the existing marriage tax penalty and increases the current child tax credit. Ryan voted for the legislation, which passed today in the Ways and Means Committee by a vote of 23-16. The bill could come before the full House of Representatives for a vote as early as next week.

“After working to safeguard Social Security and Medicare and pay down the public debt, Congress needs to return much of the surplus to the taxpayers who generated it,” said Ryan. “Besides lowering tax rates for all taxpayers, we must reduce the high tax burden on families. It's ridiculous that people pay higher taxes simply because they are married. The excess taxes these couples now pay could be better saved to cover family expenses such as home repairs, school tuition, or medical costs. It's a question of fairness – people shouldn't pay more in taxes just because they are married. The measure we voted on today works to correct this."

"In addition, by doubling the child tax credit, and phasing this in as quickly as possible, this legislation offers immediate assistance to families," Ryan added. "It lets them keep more of their money right away, which makes a big difference when you consider all the extra expenses that come with raising children."

Among other things, the bill marked up today by the Ways and Means Committee substantially reduces the marriage penalty – the bias in the tax code that makes many working married couples pay more in taxes than they would if they were not married but still lived together. The legislation would increase the standard deduction for married taxpayers filing jointly to twice that for single filers. This would take effect starting next year. In addition, the legislation would phase in an increase in the size of the 15-percent income tax bracket for married couples filing jointly to twice the size of the corresponding rate bracket for single filers. This provision would be fully effective for taxable years beginning after December 31, 2008.

Additionally, the legislation approved today by the Ways and Means Committee would increase the child tax credit to $1000, phased in over six years, beginning in 2001. (Under current law, an individual may claim a $500 tax credit for each qualifying child under the age of 17.)  The following table shows the proposed increase in the amount of the child tax credit.
 

Proposed Increase of the Child Tax Credit  
 

Taxable Year		Credit Amount Per Child
2001		$600
2002		$600
2003		$700
2004		$800
2005		$900
2006 and thereafter		$1,000

Today's Ways and Means Committee markup follows in the wake of a hearing the committee held yesterday to consider the Bush Administration's remaining tax relief proposals, including marriage penalty relief and doubling of the child credit. Earlier this year, the committee ordered favorably reported H.R. 3, the "Economic Growth and Tax Relief Act of 2001" – a bill reducing individual income tax rates. H.R. 3, which incorporated the first major piece of President Bush's tax relief plan, passed in the House of Representatives on March 8.

When added to H.R. 3, the expansion of the child tax credit would mean that an average family of four could get up to $560 of tax relief in 2001.

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