WASHINGTON — The Bush administration declined to cite China as a country that manipulates its currency to gain unfair trade advantages, provoking an outcry from lawmakers who pledged to pass tougher legislation to force the administration to act.

Treasury Secretary Henry Paulson, who is leading the administration’s effort to deal with a soaring trade gap with China, issued his department’s semi-annual report yesterday, finding that China does not meet the technical requirements for being labeled a currency manipulator.

As in past reports, the administration said the Chinese government was moving too slowly to implement various economic reforms to deal with a widening trade gap with America. The report contended that the pace the Chinese currency is being allowed to rise is “much too slow and should be quickened.”

Key members of Congress denounced the failure to act and said they were introducing legislation that would remove roadblocks in current law to pursuing a tougher line with China. Anger in Congress has been growing as America’s trade deficit has soared to record levels.

Senator Schumer, a Democrat of New York, and Senator Graham, a Republican of South Carolina, who last year pushed legislation that would penalize China by imposing 27.5% tariffs on all Chinese imports, said yesterday they were introducing a revised bill that would change the description of the infraction from currency manipulation to “fundamentally misaligned currency for priority action.”

The measure, which had the key backing of the Finance Committee chairman, Senator Baucus, a Democrat of Montana, and Senator Grassley, a Republican of Iowa, would set up a schedule of escalating punitive actions against countries designated as having priority misaligned currencies.

Those actions would include using the amount that a currency is undervalued in figuring penalty tariffs to impose on the designated country in dumping cases, where countries are found to be selling products in the U.S. market at below fair value.

The legislation would also withhold U.S. votes for loans any designated country might be seeking from the World Bank or other international lending institutions. It would require the administration to bring a case against a designated country before the World Trade Organization one year after the priority designation if the currency was still undervalued.

“This breakthrough proposal is like nothing else because it’s tough, wide-reaching and WTO-compliant,” Mr. Schumer said. “The previous legislation got China’s attention. The purpose of this legislation is to force change.”

American manufacturers contend that China is undervaluing its currency by as much as 40%. That has been a boon for U.S. consumers, providing them with cheaper-priced Chinese imports, but it has driven the U.S.-China trade gap to an all-time high of $232.6 billion, one-third of America’s record deficit of $758.5 billion last year.