The U.S. Senate bogged down in debate last week over tobacco-control legislation, as Republicans and Democrats maneuvered over how to use tobacco-tax revenues to offer an election-year tax cut.
But with controversial amendments now burdening the bill and the Senate little closer to a final vote after days of debate, Majority Leader Trent Lott (R-Miss.) said last week that the tobacco legislation could "collapse of its own weight."
"Greed has just gone hog-wild here," Lott said.
Senate Democratic Leader Thomas Daschle (D-S.D.) and Sen. Phil Gramm (R-Texas) circulated rival amendments proposing use of tobacco-tax revenues. One such use would be to increase the tax break for self-employed people purchasing their own health insurance.
Health insurance reforms enacted in 1996 call for a gradual increase in how much of their premiums self-employed people can deduct from their taxable income. Before the 1996 law passed, only 30% could be deducted, but under the law that will gradually increase to 80% in 2006.
Daschle's amendment would increase the deductibility to 100% in 2001.
Their amendments, which also would aim to eliminate a tax penalty on two-income married couples, aim to break a Senate logjam over the legislation's $1.10-per-pack increase in the tobacco tax. That increase is under a mounting attack by conservatives and the tobacco industry.
Gramm said his aim is to "lessen the wealth effect" of the tobacco tax increases because low- and moderate-income smokers would pay a disproportionate share.
"Many Americans are going to pay more in tobacco taxes than they're going to get back in tax cuts," Gramm said.