Mack, Breaux Eyed for Tax Panel

WASHINGTON – Two former senators, Connie Mack and John Breaux, are the leading candidates to head President Bush’s panel to recommend changes to the tax code, according to a White House official and other Republicans familiar with the selection process.Mr. Mack, a 64-year-old Republican from Florida, left the Senate in 2000 after two terms and is now a senior policy adviser at the Washington-based law firm of Shaw Pittman. Mr. Breaux, 60, a three-term Democrat from Louisiana, retired from Congress this month. As lawmakers, both supported tax cuts.“These would be two solid, bipartisan choices,” said Pamela Olson, Mr. Bush’s former assistant treasury secretary for tax policy and now a partner at the Washington-based law firm of Skadden, Arps, Slate, Meagher & Flom. “There is a lot of agreement over the principles of tax reform, yet all we ever hear about is the differences, so hopefully the group will come together and make proposals that find broad support.”Setting up the panel will be Mr. Bush’s first step toward satisfying his campaign pledge to streamline the 3,000-page tax code, which he says is too complex and discourages savings. The panel may examine options including closing loopholes and adjusting income tax rates, or a more radical shift to flat-rate, national sales, or value-added tax systems that focus on consumption rather than income.The White House is still researching the backgrounds of Messrs. Mack and Breaux, along with other business leaders, politicians, and economists who will join the nine-member committee, said the people familiar with the selection process, who spoke on the condition that they not be named. The rules of the panel will state that members can’t represent companies that have tax matters before the Congress or Internal Revenue Service, they said.The tax panel will be announced “in a matter of days,” White House spokesman Scott McClellan told reporters today. A message left for Mr. Breaux at his office in Lafayette, La., wasn’t immediately returned. Mr. Mack was unavailable for comment.Mr. Mack, former chairman of the Joint Economic Committee, has been a supporter of supply-side economics based on low taxes. In 1995, he suggested a flatter tax code.Mr. Breaux was the first Democratic senator to endorse Mr. Bush’s 2001 tax trimming. He later voted against the additional $330 billion tax cut Mr. Bush won in 2003, citing concern about the budget deficit as the reductions reached a total of $1.85 trillion over 10 years.Both Messrs. Mack and Breaux criticized the estate tax that Mr. Bush wants to eliminate and echoed the president’s call for tax-free programs that encourage savings. Republican economists such as Bruce Bartlett, a former tax official under President George H. W. Bush, predict the president will ultimately propose limited reform rather than sweeping change. “The more ambitious the agenda, the less likely they will get something done,” said Mr. Bartlett, now a senior fellow at the National Center for Policy Analysis.Congress last rewrote the tax code in 1986, when Republican and Democratic lawmakers united at the behest of President Reagan to lower marginal income tax rates by eliminating more than $500 billion in tax shelters and deductions.Mr. Bush wants his panel to report to Treasury Secretary Snow within months on how the administration can change the tax system in a way that maintains the $2 trillion in income the federal government receives through taxes. A White House memorandum in September said the president wanted answers to 11 questions on ways to make the 92-year-old tax system more fair, easier to understand, and responsive to different family structures.A flat tax and a national sales tax are two kinds of consumption taxes that Mr. Bush has said in the last six months he may consider. Greg Mankiw, chairman of the president’s Council of Economic Advisers, said last month a system that encourages savings is a “natural” alternative to taxing income, and that a conversion to a consumption tax would boost savings, productivity, and wages.Advocates of such change include House Speaker Dennis Hastert, the Illinois Republican, and Steve Forbes, the chief executive officer of Forbes Inc. They say Mr. Bush has the congressional backing to take bold action, and that the current code hurts the economy.

Mack, Breaux Eyed for Tax Panel

Mack, Breaux Eyed for Tax Panel

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