WASHINGTON - Making his first public statement on taxes since Congress approved the urban aid tax bill, President Bush said in his Sunday night debate with Gov. Bill Clinton and Ross Perot that he would continue vetoing tax bills that are unfair to American taxpayers.
"In terms of vetoing tax bills... I'm going to protect the American taxpayer against the spend-and-tax Congress," Bush said during the presidential debate at Washington University in St. Louis.
Bush did not refer specifically to the $27 billion urban aid bill cleared by Congress on Thursday, but defended his decision to veto a tax bill Congress had sent to him in April. "I'm going to keep on vetoing them, because I don't think we are taxed too little," he said. "I think the government's taxing [the public] too much."
Bush's upcoming decision on the urban aid bill has been the subject of widespread speculation among municipal bond proponents and lobbyists who favor other provisions in the huge measure.
Many Republican congressional leaders and some White House officials have predicted a veto because the bill contains tax increases. But lobbyists with a stake in the measure have been holding out hope that he will sign because he has not yet announced he will reject it.
For the municipal market, the bill would make the low-income housing tax credit and the tax exemption for mortgage revenue bonds permanent. It would also extend the tax exemption for small-issue industrial development bonds through Sept. 30, 1993, and ease curbs on qualified redevelopment bonds so they could be issued in urban enterprise zones.
Bush's remarks on taxes came in response to an attack from Clinton. The Arkansas governor said Bush should have accepted the April tax bill because it would have resurrected a tax credit for business investment, offered middle class tax relief, and extended an expiring tax credit for research and development.
Although Bush did not mention the pending urban aid tax bill during Sunday night's debate, he indicated he preferred to hold off on tax legislation until the 103d Congress convenes in January with a large number of new members.
"I'm going to protect the working man by continuing to veto and to threaten to veto until we get this new Congress, and then we're going to move forward with out plan," Bush said.
During the debate, Clinton said his overall approach to the tax issue would be to raise the marginal income tax rates on families making at least $200,000 annually. He would couple that increase with "modest middle-class tax relief to restore some fairness," by cutting taxes for families with annual incomes of less than $60,000, he said.
Perot said tax increases would be needed to cut the federal deficit, and he said one area he would target is the federal gasoline tax. He said he would favor a 50 cents per gallon increase in the tax.
"We cannot pay off the $4 trillion debt, balance the budget, and have the industries of the future and the high-paying jobs in this country without having the revenue," Perot said.
"We've got to clean this mess up, leave this country in good shape, and pass on the American dream to [our children]. We've got to collect the taxes to do it," he added.
But Bush said raising the gas tax would be unfair to people who drive extensively for their jobs. In addition, he argued that paying for Clinton's programs would mean higher taxes for the middle class and not just the wealthy. Bush added he was worried that if the federal government increased taxes, it would spend the money instead of using it to lower the federal deficit.
"I don't think we need to tax more and spend more," Bush said.
"The old adage they use, ~we're going to soak the rich, we're going to soak the rich,' it always ends up being the poor cab driver or the working man that ends up paying the bill," he added.