GOP, with an eye on '94, puts its spin on tax rise ON POLITICS



WASHINGTON -- Even before the votes are cast in the House and Senate on the compromise deficit-reduction package, the maneuvering for political advantage in the 1994 congressional elections is under way. And it is clear already how the Republicans intend to keep the label of tax-and-spend securely tied to President Clinton and the Democratic Party.

Senate Minority Leader Bob Dole and House Minority Leader Bob Michel have taken to the airwaves to zero in on the provision that would raise personal income tax rates from 31 percent to 36 percent retroactive to Jan. 1, 1993. When voters find out on Tax Day, 1994, that they are going to have to swallow a retroactive tax bite, Dole and Michel say, they will go bananas.

Dole, slyly relating the provision to Democratic senators up for re-election next year, says the provision is likely to produce some "retroactive senators" -- meaning those Democrats who vote for the deficit-reduction package. Dole, who would like to become the Senate majority leader again as he was from 1984 through 1986, is telling Republican audiences that it's possible to pick up the seven Senate seats that would boost the current GOP strength of 44 to the majority.

What Dole and Michel don't highlight is the fact that both the personal income tax rate increase and the retroactive provision would apply only to individuals with taxable incomes of more than $115,000 a year and couples with more than $140,000 -- by some reckonings only about 1.2 percent of taxpaying Americans. In a sense, the tax is standard Democratic soak-the-rich stuff that should not anger lower and middle-income taxpayers -- but probably will if the Republican presentation is effective, as the polls indicate it has been so far.

Senate Majority Leader George Mitchell belatedly is pointing out to these voters that the overwhelming bulk of the tax increases in the budget compromise legislation will be borne by the affluent, but so far at least the message does not seem to have gotten through.

Clinton himself continues to say, as he did as a presidential candidate last year, that the time has come when those who most benefited from the tax cuts of the Reagan years should start paying their fair share for the huge federal deficit that mushroomed as a result of the Reagan tax cuts and borrowing. But the Republicans have been so successful in painting the Clinton income tax increases as a general burden for all Americans to bear that the point has been largely lost.

The Democrats, in one way, have only themselves to blame. When Clinton first announced that rather than delivering the middle-class tax cut that he talked about in the 1992 campaign he would have to raise taxes, he never made clear that personal income taxes would not rise for most Americans. Instead, he focused on increased energy taxes that don't hit the average voter psychologically with the same force as seeing weekly paychecks reduced by income tax withheld and by a dreaded income tax bill every April.

This is the same mistake that Democratic presidential nominee Walter Mondale made in pronouncing in his 1984 convention acceptance speech that he was going to raise taxes as a fiscal necessity to get the country out of the mess that the Reagan tax-cut policies had created (and Clinton labors under today). Mondale talked only in generalities on that occasion and for some weeks later, not pointing out that households earning less than $25,000 a year would not pay a nickel of additional income taxes, those in the $25,000-$35,000 bracket would pay less than two dollars a week more and those making up to $45,000 would pay only four dollars more.

By the time Mondale finally laid out these details, however, the Republicans had effectively advertised the proposed Mondale taxes as a sweeping attack on the little guy's wallet.

The same strategy clearly is in the making by Dole and Michel, and will be a hard one for the Democrats to counter if the deficit-reduction package is enacted.

Clinton and the Democratic leadership in Congress, however, do have plenty of time between now and the 1994 congressional elections to convince most voters that it's the rich who are being soaked.

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