
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: MONDAY, December 12, 1994                   TAG: 9412140028
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A1   EDITION: METRO 
SOURCE: LOS ANGELES TIMES
DATELINE: MIAMI                                 LENGTH: Medium

CLINTON PROPOSES A TAX CUT

President Clinton, plunging into a possible tax-cutting contest with Congress' new Republican leadership, said Sunday that he plans to propose a middle-class tax reduction - and believes he can do it without increasing the federal budget deficit.

``I intend to propose one as long as I can pay for it,'' Clinton told a news conference at the end of his three-day summit meeting with 33 other leaders of Western Hemisphere nations.

``I do not want to see this deficit start going up again,'' he said. ``That is my objective. I think we can achieve that objective.''

Aides said the tax plan may be unveiled as early as Thursday, when Clinton plans a major speech outlining goals and priorities for the second half of his term.

While Clinton pledged that any tax cut he presents will be fiscally responsible, other administration officials rejected out of hand Sunday a budget-relief proposal on trimming Social Security and Medicare spending from the leaders of a presidential bipartisan commission on federal entitlements reform.

Sen. Bob Kerrey, D-Neb., and Sen. John Danforth, R-Mo., leaders of the panel, said in an interview on NBC-TV's Meet the Press that reining in the growing cost of such massive federal programs was the only way of averting a financial crisis after the turn of the century that will punish future recipients and young workers.

Clinton had called for a middle-class tax cut in his 1992 presidential campaign but edged away from the promise when he found it impossible to cut taxes and reduce the deficit at the same time. Now, he said, ``I want to fulfill the commitment of our campaign and my commitment to tax fairness.''

It was the strongest such promise yet from the president, who renewed his interest in reducing middle-class taxes after Republicans won majorities in both houses of Congress last month.

Clinton did not offer any details of the tax relief he may propose, but aides said proposals include a tax credit aimed at middle-income families of several hundred dollars per child.

The president posed two conditions for any tax-cut proposal. He said any tax cut must not increase the deficit. At the same time, he said, it should not be paid for by reductions in federal spending that would come at the expense of people he described as the ``temporarily poor'' and ``responsible parents.''

``I think we can achieve that objective ... without hurting poor people,'' he said.

``I don't believe that we should be pitting the middle class against the poor, who themselves are willing to embrace the values of work and family and community - and I don't think we have to do that,'' he added.

by CNB