Massachusetts Acting Governor Seen Ready to Deal on Taxes in Fiscal Talks.

Byline: Frank Phillips

Apr. 10--After months of insisting she would not budge on the issue, Acting Governor Jane Swift is quietly laying the groundwork to agree to delay the state income tax rollback if she sees similar compromises from Democratic leaders on her budget proposals, administration sources say.

Swift, unshackled politically since she dropped her gubernatorial bid last month, is ready to make the turnaround as part of her effort to forge a budget agreement on Beacon Hill to address the state's expanding deficit, the sources said.

She wants the Democrats, in turn, to entertain her money-saving ideas, including trimming the prize payouts in the state lottery and reducing payments to the state pension fund.

Publicly, Swift is sticking with her strong antitax position, in which she has argued that freezing the tax rate at 5.3 percent, rather than rolling it back to 5 percent as scheduled next year, would be a tax hike.

But privately she has signaled a willingness to put the issue on the table when she meets with Democratic leaders for sensitive budget negotiations later this week.

Even her aides have softened the public antitax rhetoric. Asked yesterday if she is ready to bend on the issue, her spokesman, James Borghesani, said Swift is headed into the meeting with House Speaker Thomas M. Finneran and Senate President Thomas F. Birmingham with the presumption that all revenue-raising and budget-cutting issues are up for consideration.