WASHINGTON - The Bush administration's hard line against adding goodies to its tax-cut plan is thwarting efforts by automakers, suppliers and other businesses to win more tax breaks.
A move to add a corporate income tax cut to President Bush's 10-year, $1.6 trillion package effectively is on hold. And top administration officials made it clear last week they will oppose so-called special-interest additions to the package as it goes through Congress.
For example, that would rule out tax credits for buyers of fuel-efficient, advanced-technology vehicles - a top priority for automakers.
But the auto industry isn't completely shut out of benefits that would come from the tax package President Bush sent to Congress early this month.
A boost for r&d
The Bush plan would make permanent the federal tax credit companies get for research and development spending. The 20 percent credit, which was first enacted in 1981, has lapsed three times in the past two decades.
'The on-again, off-again nature of the tax credit impedes long-term research,' the administration wrote in its submission to Congress.
In addition, the proposed repeal of the estate tax, a top priority of car dealers and family owned suppliers, remains a part of the Bush plan.
But estate tax repeal is less of a sure thing now than it seemed when people first realized Republicans would control both houses of Congress and the White House this year.
'Everyone thought this is a slam dunk. Well, it isn't,' said an industry lobbyist who asked not to be named.
One reason is that administration and congressional leaders now favor acting first on cuts in personal income tax rates and dealing with the rest of the Bush package later in the year.
Such a delay increases the chances that the estate tax could become a bargaining chip in negotiations with Democrats in Congress, many of whom say a full repeal unfairly favors the rich.
A fight for hybrids
Meanwhile, groups hoping for a broad business tax cut or for special items, such as tax credits for gasoline-electric hybrid vehicles, are pinning their hopes on the horse trading that will certainly occur when the second half of the tax package is considered.
Automakers will vigorously tell lawmakers about 'the impediments to bringing this technology to market,' said Gloria Bergquist, vice president of the Alliance of Automobile Manufacturers. Tax credits are 'the right thing to do' to overcome buyer resistance to the higher costs of advanced technology, she said.
On other issues, spokesmen for General Motors and Ford Motor Co. said their companies are interested in getting the federal government to change the way it treats income from overseas operations.
Many more ideas are under discussion in corporate offices, trade associations and lobbying shops throughout the Washington area.
But so far, the Bush administration is holding firm against additions.
Its stand against the full range of requests from a myriad of special interests is undermining one of the main arguments for a broad corporate tax cut - that it would be a desirable alternative.
Proponents of a corporate income tax rate reduction had hoped to argue that their idea was preferable to a big collection of special-interest add-ons. It would uniformly benefit all businesses and keep the legislation from being overloaded with special breaks.
But the advocates of add-ons have made so little progress that the Bush administration sees little reason to compromise.
'We are very impressed with the president's momentum and his ability to stave off sectoral proposals,' said Mark Bloomfield, president of the American Council for Capital Formation, a business group whose members helped launch the drive for a corporate income tax rate cut.