WASHINGTON Senate Banking Committee Chairman Phil Gramm last week dampened the financial services industrys hopes for new retirement savings incentives, saying the legislation would probably have to wait until next year.
Industry lobbyists were disappointed that President Bushs $1.6 trillion tax-cut proposal does not call for increasing the ceilings on tax-deferred contributions to Individual Retirement Accounts and 401(k) accounts. They had otherwise loudly applauded the plan for its potential to spur long-term economic growth and held out hope that lawmakers would add the savings provisions before passing it.
However, key Senate Republicans on Thursday reiterated their intention to keep retirement savings incentives and other corporate tax issues out of the Bush tax-cut package.
You can go through a whole list like increasing tax-free contributions to IRAs, 401(k)s, but I think that we should focus on getting this job done first, Senate Majority Leader Trent Lott told reporters.
Sen. Gramm said he agreed, and his additional comments suggested that prospects for stand-alone legislation this year are poor, too.
There is a distinct possibility that, if we do our job this year and stay with the $1.6 trillion individual income tax cut and hold spending within the limits, we could have a chance next year to do another tax cut, the Texas Republican said.