Senate Floor Speech
Senator Kay Bailey Hutchison
October 9, 2001 -- Page: S10390

MRS. HUTCHISON. Madam President, I rise today to introduce legislation that will build upon the historic Economic Growth and Tax Relief Reconciliation Act of 2001 by accelerating the marriage penalty tax relief in that bill and make it effective beginning next year. I am joined in my effort by Senators Brownback, Miller, Smith of New Hampshire, Hutchinson, Fitzgerald, and Allen.

Earlier this year we delivered to the American people long overdue tax relief. Unfortunately, we did not have the ability to give married couples the relief from the marriage penalty as soon as we would have liked. My bill will complete this unfinished business by treating married couples fairly in the tax code beginning next year. Particularly now, as the President and Congress consider additional tax relief to bolster the economy in these difficult times, this legislation would be a smart option. At times like this, what better way to help our Nation than by strengthening the building blocks of society, our families, by adding to their budgets through marriage penalty relief.

Every year for the past four years I introduced a bill to eliminate the marriage penalty tax as I simply could not understand why two single people should be thrown into a higher tax bracket and pay more in taxes simply because they got married. Not because of a promotion, not because of a raise, but because they got married! This year, we finally told all Americans that they do not have to choose between love and money, that they should not be penalized for exchanging wedding vows. I am proud to say that in this year's tax relief plan we corrected this quirk in the tax code. We returned to the commonsense principles that made this country great, and away from the concept that "no good deed goes unpunished.''

The marriage penalty relief that was passed earlier this year will offer critical relief to our married couples, but unfortunately it will not take place immediately. I want to improve this timing because when the situation is as ridiculous as the marriage penalty, that is wrong. There are more than 20 million married couples in America today that pay a penalty just because they got married, a penalty that averages around $1,400. That is a lot of money! Especially when you are just starting out, $1,400 to a young couple could be part of the down payment on the new house or the new car for the expenses associated with having children. However, they choose to spend that money, or for whatever expenses they need it for, we want them to be able to make their own choices with the money they earn.

And we want them to have the ability to do so now, not several years from now. What the bill does that I am introducing today is that it takes the relief we finally offered in the tax plan and makes it effective immediately for the 15 percent bracket and the standard deduction.

Today, if you take the standard deduction when you do your taxes as an individual, you do not get the same amount of deduction if you get married. That is, the standard deduction does not simply double for couples. Whereas today the standard deduction for a single person is $4,550, and for a married couple is $7,600, our tax relief bill insisted that married couples receive a standard deduction that is exactly double that of the single person, or $9,100. Under my bill today, this doubling of the standard deduction will occur immediately.

In addition, we addressed the fact that when most couples marry, the second income bumps them up to a higher tax bracket. Therefore, we decided to widen every tax bracket so that a married couple will not have to pay more in income taxes simply because they go into a higher bracket when they combined incomes.

In this way, a combined income will be taxed at the same rate as if it was a single person making two incomes. For example, if each individual in a relationship is in the 15-percent income tax bracket but they get married and their combined incomes now bump them into the 30-percent bracket, our tax relief means that they will effectively remain in the 15 percent bracket.

This is critically important, especially to those who are at the lower income rates and for whom jumping from the 15 percent bracket to the next one could make all the difference in their budget. Our earlier legislation widens the 15-percent bracket by $9,000 for married couples. My bill today will accelerate this relief by making this change now, thereby eliminating the marriage penalty for those couples who are in the 15 percent bracket.

Earlier this year a bipartisan majority agreed that it is very important that we relieve the pressure on the more than 20 million American couples who pay the marriage penalty tax. We all agreed then that this is wrong, and must be changed. Today, we have the chance to put our money where our mouth is and offer help to struggling couples now. I call upon my colleagues to join in this effort to provide this immediate assistance to the working families of America.