>From the Center on Budget and Policy Priorities
(CBPP);
Revised March 11, 2005
HOUSE BUDGET RESOLUTION CUTS KEY LOW-INCOME PROGRAMS Yet Budget Finds Room for Further Tax Cuts for the Wealthy
By Sharon Parrott and Isaac Shapiro Press Release: HTM | PDF
The budget resolution passed by the House Budget Committee on March 9 includes substantial reductions in key programs for low-income families, seniors, and people with disabilities while calling for large tax cuts whose benefits would flow largely to wealthy Americans.Ý The budget resolution calls for an estimated $30 billion to $35 billion in cuts over the next five years from low-income ìmandatoryî (also known as ìentitlementî) programs, including Medicaid, food stamps, and the Earned Income Tax Credit ó a significantly higher level of cuts than were proposed in the Presidentís budget.Ý Low-income Americans would absorb a large and disproportionate share of the cuts in mandatory programs.Ý As much as half of the mandatory cuts would come from low-income programs.
The budget resolution the House Budget Committee adopted also calls for $106 billion in tax cuts over the next five years and puts $45 billion of these tax cuts on a legislative ìfast trackî to ease their enactment.
The Size of the Reductions in Mandatory Programs
The Budget Resolution that the House Budget Committee approved on March 9 would cut mandatory programs by a total of $68.6 billion over the five-year period from 2006 through 2010.Ý Over the period:
* The cuts in the Medicaid program would total at least $15 billion and could be as much as $20 billion.[1]Ý For the purpose of comparison, this level of savings is roughly equal to the cost of the capital gains and dividend tax cuts that would go to the three to four percent of Americans with incomes above $200,000.Ý[2]
* Low-income programs under the jurisdiction of the House Ways and Means Committee would be cut by about $15 billion.[3]Ý This is roughly equivalent to the total amount that households with incomes exceeding $1 million will receive in tax cuts over the next five years from two tax cuts that were enacted in 2001 but have not yet taken effect.Ý The two tax cuts in question, which are slated to phase in starting in 2006, affect only high-income households.Ý These two measures repeal provisions of current law that limit the personal exemption and itemized deductions for taxpayers at high income levels.
* The House Agriculture Committee would be required to cut farm and nutrition programs by a total of $5.3 billion.Ý The Presidentís budget called for $600 million in food stamp reductions over this period, but some members of that Committee have indicated they intend to make much deeper cuts in the Food Stamp Program than the Administration has proposed so they can substantially reduce the size of, or eliminate, the farm cuts.Ý The Food Stamp Program thus could be cut by as much as $5.3 billion.Ý Even this large a cutback would be equivalent to just half of the benefits to households with incomes over $1 million of extending the capital gains and dividend tax cuts through 2010Ý
Click below for full report...
http://www.cbpp.org/3-10-05bud2.htm
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