Congress likely to act on economy - changes expected in investment tax credit and capital gains tax

Nation's Business, March, 1992

Sen. Trent Lott, R-Miss., says he expects Congress to pass an economic-growth package this year despite basic differences between Democrats and Republicans on specific elements.

"Will it be what the president asked for? Will it be perfect? No, but I think it will have a lot of good provisions in it," he told business representatives at a meeting held at the U.S. Chamber of Commerce.

Lott said he believes a capital-gains tax cut and changes related to the investment tax credit stand a good chance of being approved. "Believe me, though," he continued, "the Democrats will extract a penalty" for legislation containing these kinds of tax cuts. That penalty, he warned, is likely to be tax increases on upper-income Americans.

Lott said the extent to which the president presses for a growth package will be a key factor in determining congressional action.

The senator suggested that the president take a harder line with Congress by offering cooperation with the caveat that "if that doesn't work, I'll fight you." Congress will respond, Lott said.