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U.S. House to vote on budget plan amid Republican fight on taxes

[October 26, 2017] By David Morgan

WASHINGTON (Reuters) - The U.S. House of Representatives was set to vote on Thursday on a budget blueprint central to efforts by Republicans to enact big tax cuts, but the outlook was clouded by a rebellion by moderates within the party from high-tax states.

The budget plan, which has already been approved by the Senate, would pave the way for a tax-cut package to clear that chamber with a simple majority.

Without the plan, Senate Republicans, who hold a slim 52-48 majority, would need to secure 60 votes. That would require support from Democrats, who have called the tax plan championed by Republican President Donald Trump a giveaway to corporations and the wealthy.

But some Republicans in the House vowed to vote against the budget measure in an effort to protect a popular deduction for state and local income taxes that could be on the chopping block. Eliminating the deduction would hit middle-class voters in high-tax states like New York, New Jersey and California.

"Why should I vote for something that would end up decimating my district?" Representative Peter King of New York told Reuters. King said he was urging colleagues who shared his concerns to join him in voting against the budget plan.

Republican Representative Tom MacArthur of New Jersey told reporters on Wednesday it was possible there were enough votes to block it. "It's got to be close," he said.

But House Majority Whip Steve Scalise, the No. 3 Republican in the chamber, predicted victory, and the Republican leadership set a vote for 10:30 a.m. (1430 GMT). "We're going to get it done," Scalise told Fox News Channel.

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House Majority Whip Steve Scalise (R-LA) speaks at the Values Voter Summit of the Family Research Council in Washington, U.S. October 13, 2017. REUTERS/James Lawler Duggan

Republicans are working on a package that independent analysts say would cut taxes for companies and individuals by up to $6 trillion over the next decade, but detailed legislation is not expected to be unveiled until next week.

Having been dealt a stinging defeat in an effort to repeal former President Barack Obama's signature healthcare law, a win on taxes would give Trump his first big legislative victory.

The battle within Trump's own party over the state and local income tax deduction offers a preview of the tough fights ahead as Republicans seek to do away with other popular tax breaks.

Republicans plan to cut the corporate income tax rate to 20 percent from 35 percent and lower taxes for individuals, while giving families a larger standard deduction. But they need to find ways to make up for some of the lost revenue.

(Reporting by David Morgan; Additional reporting by Richard Cowan, Amanda Becker and Susan Cornwell; Writing by Tim Ahmann; Editing by Peter Cooney)

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