GOP tries to mend rift over de­duc­tion

Ryan blasts states whose res­i­dents rely on state-lo­cal break

The Dallas Morning News - - Nation&world - Marcy Gor­don and Ken Thomas, The As­so­ci­ated Press

WASH­ING­TON — The top House Re­pub­li­can on Thurs­day blasted high-tax states, even though their tax­pay­ers de­liver bil­lions to the fed­eral govern­ment, as he faced a back­lash from rank-and-file GOP law­mak­ers over a sweep­ing tax-cut pro­posal.

But beyond the tough rhetoric from Speaker Paul Ryan, dis­grun­tled GOP law­mak­ers from high-tax states met pri­vately with Re­pub­li­can lead­ers and reached for com­pro­mises to break the im­passe. The law­mak­ers op­pose the plan’s pro­posal to re­peal the pop­u­lar fed­eral de­duc­tion for state and lo­cal taxes. It’s used in large num­bers by res­i­dents of their states.

With Repub­li­cans splin­tered, the fu­ture of the $6 tril­lion tax over­haul plan is threat­ened by the GOP de­fec­tions. The suc­cess of the pack­age is a po­lit­i­cal im­per­a­tive for Repub­li­cans, who have pinned their hopes on a big leg­isla­tive achieve­ment to help them re­tain con­trol of Con­gress in next year’s elec­tions. It’s also Pres­i­dent Don­ald Trump’s high­est leg­isla­tive pri­or­ity to ful­fill his prom­ise of boost­ing eco­nomic growth.

Ryan went on the of­fen­sive against high-tax states in­clud­ing Cal­i­for­nia, New York and New Jer­sey even though the GOP law­mak­ers from those states need to be brought on board to sup­port the tax over­haul plan.

Ryan con­tended that the rest of the coun­try is “prop­ping up prof­li­gate, big-govern­ment states” that levy high taxes on their res­i­dents and spend reck­lessly.

“States that got their act to­gether are pay­ing for states that didn’t,” the Wis­con­sin law­maker said in an ap­pear­ance at the con­ser­va­tive Her­itage Foun­da­tion.

In fact, Cal­i­for­nia, New York and New Jer­sey send many bil­lions more in taxes to Wash­ing­ton than they get back in fed­eral spend­ing, new data shows. New York gets back 81 cents for ev­ery $1 its res­i­dents pay in, New Jer­sey re­ceives 74 cents and Cal­i­for­nia 96 cents, ac­cord­ing to an anal­y­sis re­leased last month by the Rock­e­feller In­sti­tute of Govern­ment.

The state-lo­cal de­duc­tion is claimed by 44 mil­lion Amer­i­cans and costs the govern­ment an es­ti­mated $1.3 tril­lion in lost rev­enue over 10 years.

Su­san Walsh/the As­so­ci­ated Press

House Speaker Paul Ryan, ad­dress­ing the Her­itage Foun­da­tion in Wash­ing­ton on Thurs­day, touted the sim­plic­ity of an­nual tax fil­ing un­der a tax over­haul pro­posal that Repub­li­cans are strug­gling to flesh out and unite around.

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