Cantor Spells Out Possible Tax Compromise

Wall Street Journal ^ | July 6, 2011 | Corey Boles and Kristina Peterson

[Zakeet]

A top House Republican leader suggested a way to end a stalemate over taxes in the debt-ceiling negotiations, saying Wednesday that Republicans could endorse ending some business tax breaks targeted by Democrats if they also agreed to renew other business-backed tax benefits.

The proposal by House Majority Leader Eric Cantor (R., Va.), which was described in a briefing with reporters, represents a new wrinkle in the ongoing budget discussions.

In recent weeks, Democrats have pushed for raising revenue by closing a raft of corporate tax breaks and benefits as part of a potential deficit-reduction deal that would ease the passage of a required increase in the federal borrowing limit. Such proposals include tax benefits currently available to owners of corporate jets, yachts, thoroughbred horses, ethanol fuel producers and the largest oil and gas companies.

Until now, senior Republicans have said those measures could only be addressed in the context of overhauling the entire tax code, which most political analysts don't expect this year. Mr. Cantor said he would be open to including closures of such tax benefits as long as Democrats go along with renewing popular business tax benefits such as the research and development tax credit.

Brad Dayspring, Mr. Cantor's communications director, listed several other examples, including extending a one-year payroll tax credit for employees.

It is unclear whether Democrats would go for Mr. Cantor's proposal, or if they would continue to insist that tax breaks for corporations be ended in exchange for the deep spending reductions Republicans are pushing for in a deficit-reduction deal.

[curiosity]

So would you support eliminating ethanol tax credits if you couldn't get a simultaneous reduction in tax rates?

[itsahoot]

Do you support armed robbery?