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Officials push abolition of tax that hurts veterans

Associated Press
Published November 12, 2003

TAMPA - House Minority Leader Nancy Pelosi vowed Tuesday to keep up the pressure in Congress to abolish a long-standing tax policy that cuts into retirement benefits for disabled veterans.

Participating in a round-table discussion before a Veterans Day ceremony, the California Democrat said her party is turning up the political heat on the so-called "disabled veterans tax," which cuts into the benefits of about 560,000 veterans each year.

Under an 1890 law aimed at Civil War veterans, retirement pay is cut a dollar for every dollar received in disability compensation. For years, veterans and their many allies in Congress have pushed to change it but made little progress because of the cost, commonly put at about $58-billion over 10 years.

Pelosi compared the veterans' situation to President Bush's tax cut, which Democrats have complained mostly went to the rich.

"One thing that should be clear to all of us, this is about priorities," Pelosi said. "When the priority is to take hundreds of billions of dollars off the table to start off with for tax cuts, . . . why couldn't we start with eliminating the veterans disability tax?"

Part of a defense bill that passed the House Friday could restore full benefits to about a quarter million disabled veterans. But Democrats say the measure, which would be phased in over 10 years and is designed mainly to help the more seriously disabled, is inadequate because it would leave out veterans with less serious disabilities.

An alternative package proposed by House Democrats restores full benefits to all disabled veterans and also improves accessibility to health care, bolsters veterans' educational opportunities, and provides a $1,000 bonus to those serving in Iraq and Afghanistan.

Pelosi and U.S. Rep Jim Davis, a Tampa Democrat, said the issue hasn't been entirely partisan. They lauded their Republican colleague, U.S. Rep. Mike Bilirakis of Tarpon Springs, who has championed the concurrent receipt issue for 18 years.

The policy, which costs 57,296 Florida veterans an estimated $300-million in benefits annually, was a recurring theme among the more than 20 local veterans who attended the discussion. Other concerns included long waits for health care, slow processing of claims and inadequate retirement benefits that could hurt retention.

Mary Ellen Harlan, who sits on the board of the Hillsborough County Veterans Council and works closely with Davis on related issues, said some who served are being forgotten in Washington.

Davis said he fears that perceived shoddy treatment of veterans will hurt recruitment and retention. "I know how we treat our veterans will influence people's decision about whether they want to make that sacrifice and provide that service," he said.

"I'm quite excited that we at least got the attention of the majority, but we want more," she said.

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