Clinton, Democrats Near Energy Tax Compromise : Legislation: The levy’s collection point would shift closer to consumers. House leaders hope the change will save the deficit-reduction bill.
WASHINGTON — Fearing another setback for President Clinton on Capitol Hill, the White House neared a compromise agreement Monday with House Democrats that would shift the point of collection on his proposed $70.5-billion energy tax from producers closer to consumers, congressional sources said.
The House Ways and Means Committee plans to take action today on the President’s $242-billion deficit-reduction package, of which the energy tax is a part, and House Democratic leaders said they were concerned that opposition to the energy tax would drag the bill down to defeat. Energy producers and their allies in Congress have voiced strong opposition to the tax.
While details had not been worked out, the compromise would impose the energy tax directly on consumers of natural gas and electricity, who would see it itemized on their utility bills. In the case of oil and gasoline, however, the new tax would be imposed as the fuel leaves the refinery gate, the sources said, and thus would not be as visible to consumers. Additional details were not immediately available.
Consumer and environmental groups strongly protested against any concessions to energy producers on the so-called “BTU tax,†contending that it would remove incentives for utilities to use cleaner fuels and impose costly administrative burdens.
“It’s one more step down the road toward giving breaks to special interests at the expense of the environment and the public,†said Tom Grasso, a representative of the Union of Concerned Scientists. “It’s distressing to see movement in the wrong direction before the bill is marked up in the first committee to consider it.â€
White House and Treasury officials, who once vehemently opposed the compromise, proposed by Rep. Bill Brewster (D-Okla.), appeared to favor a modified version of the tax to smooth passage through the House.
“We feel very good about it,†said a spokesman for Brewster. “They’re much closer to agreement than they were, and we feel this will help the bill.â€
While Republicans have gone on record against the energy tax and almost every other tax increase in the legislation, a GOP aide said that a compromise along the lines of the Brewster amendment would make the bill somewhat more acceptable to the minority.
“It would no longer be Clinton’s ‘hidden t†the Republican aide said. “Of course, we would like to see it identified on your utility bill as Clinton’s excise tax.â€
Even if a bill with a modified energy tax survives in the House, it faces an uncertain fate in the Senate, where a Republican filibuster killed the President’s $16.3-billion economic stimulus package last month.
Oil and gas interests traditionally have fared better in the Senate than in the House. And the energy tax could run into trouble in the Senate Finance Committee, where two Democrats--Sens. John B. Breaux of Louisiana and David L. Boren of Oklahoma--represent important energy-producing states.
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