CONGRESS MUST SHRINK SCOPE OF CONTRACT CUTS.(CAPITAL REGION)

Byline: DAVE SKIDMORE Associated Press

WASHINGTON With the adoption of a seven-year budget-balancing plan, House and Senate lawmakers are thinking about how to shrink the $354 billion Contract with America tax cut to fit the budget's $245 billion hole.

They're not expecting to make any final decisions until September, but already two elements of the package a $500-a-child tax credit and lower capital gains taxes seem likely to survive in some form.

``It's going to be tough,'' said House Ways and Means Committee Chairman Bill Archer, R-Texas. ``But we're going to be very adamant about the capital gains reductions and we're also going to be very adamant about the family child credit.''

But if the per-child credit and capital gains cut are adopted in their entirety, they'll …