LEGISLATORS COOL TO NEW STOCK TAX IDEA
Key tax and budget lawmakers
Wednesday expressed reservations about the suggested new
securities tax, which has has aroused concern on Wall Street
and put pressure on brokerage stocks.
    Grappling with the need to either raise taxes or cut
federal spending to meet the fiscal 1988 budget deficit target
of 108 billion dlrs, House Speaker Jim Wright suggested the tax
be studied as one way to raise more federal revenues.
    The Texas Democrat's idea as first presented to House Ways
and Means Committee chairman Dan Rostenkowski this week would
tax sales and purchases of securities. A tax of 0.25 to 0.5
percent would raise from 8.5 to 17 billion dlrs a year.
    Rostenkowski, the chief taxwriter, considers it too early
to back any tax increase idea but agreed to add the securities
transfer tax to a long list of tax alternatives under review by
congressional tax analysts, a spokesman said.
    The Illinois Democrat has repeatedly stressed this year he
is reluctant to back a tax increase so long as President Reagan
maintains his staunch opposition.
    "First we've got to decide whether to raise additional
revenues. Only then can we consider the specific options. At
this point nothing is on or off the table. It's just too early,"
Rostenkowski said in a statement.
    He made no commitment to Wright in a private meeting
Tuesday, and in fact was not asked for one, a House source
said. The idea was presented only as something that might or
might not be valuable, he said.
    House Budget Committee chairman William Gray agreed it was
another option to be looked at, if Congress decided it needed
to raise revenues to reduce the deficit, an aide said.
   The Pennsylvania Democrat does not intend to recommend
specific tax proposals, the aide said. The Budget Committee
will recommend a certain amount of revenue to be raised in
1988, but will leave to the taxwriting committee the decision
on how the taxes will be raised.
    The securities transfer tax would raise a hefty amount of
revenue to ease Congress's difficult task of trimming the
deficit by 61 billion dlrs this year to meet the target.
    But some in Congress feared that such a tax could drive
securities business offshore and hurt U.S. investment, and
there were uncertainties about the details of the tax.
    Democrats have not united behind any budget alternatives so
far this year. This week they are scheduled to discuss the
budget and possible spending cuts or tax increases but no
decisions are anticipated, congressional sources said.
    At the same time, without President Reagan's assent to a
general tax increase, they are left with piecemeal taxes that
are guaranteed to anger those who must pay.
    "We could just do all of them," one congressional source said
of the various tax ideas -- excise taxes, securities taxes, oil
import fee and others.
 Reuter
