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House Sustains Veto of Marriage Tax Penalty Bill

The House on September 13 failed to override the President’s veto of a bill (H.R. 4810) intended to alleviate the marriage tax penalty. The tally of 270-158 was 16 votes short of the two-thirds majority required to override a presidential veto. The conference report for H.R. 4810 was approved by the House on July 20 and by the Senate on July 21 (see The Source, 7/21/00, p. 1). It was vetoed on August 8.

Due to a glitch in current tax law, some married couples filing a joint return pay more in income tax than they would have been required to pay as individuals. H.R. 4810 would have addressed that discrepancy by increasing the standard income tax deduction for married couples filing jointly, making it twice the standard deduction for single filers. The bill also would have phased-in over five years an expansion of the lowest tax bracket—the 15 percent bracket—for married filers. In addition, the bill would have expanded married couples’ eligibility for the Earned Income Tax Credit. It also would have extended for five years an allowance for married couples who pay the alternative minimum tax (AMT) to qualify for certain tax credits.

The President and other critics of the bill described it as fiscally irresponsible because it would benefit all married couples, rather than just those affected by the tax penalty. Members of Congress “all agree that couples should not be penalized by the tax code when they decide to marry,” said Rep. Nancy Pelosi (D-CA), adding: “The problem with the Republican marriage penalty bill is that…half of the relief goes to people who do not pay any marriage penalty today.” She added that the “substantial costs” of the bill would “leave less money to strengthen Social Security and Medicare, provide a prescription drug benefit for seniors, pay down the national debt, and provide other essential government services.”

However, supporters of the measure called for action on the marriage tax penalty. Rep. Bill Archer (R-TX) said H.R. 4810 would provide “the most help to those middle- and lower-income Americans who are hit hardest by the marriage tax penalty,” adding: “This is especially important to working women whose incomes are often taxed at extremely high marginal rates, some as high as 50 percent, by this penalty.” Addressing concerns about the cost of the proposal, Rep. Archer asked rhetorically whether it would be “too expensive for the U.S. Treasury, which is expected to vacuum in $4.5 trillion over the next 10 years from the American taxpayers? Or too expensive for President Clinton, who just yesterday said he needed to spend that money for more government programs?”