- The Washington Times - Monday, November 28, 2005

A group of House Republicans will send a letter to their leaders next week demanding that casinos, massage parlors and liquor stores be excluded from the hurricane-related tax relief likely to be included in a final tax-cut bill this year.

The group — led by Rep. Frank R. Wolf, Virginia Republican — says the final tax bill would “not be acceptable” to them if Katrina tax relief doesn’t exclude these businesses.

“There has to be that language,” Mr. Wolf said. “Why would the Republicans want to pass a tax bill … that allows tax breaks to go to gambling parlors?”

The Senate recently passed a $58 billion tax-cut extension package that includes about $7 billion in tax breaks for people and businesses hit by Katrina and other hurricanes this year. The bill is silent on the issue of casinos and related establishments, which means these businesses could receive hurricane-related tax breaks.

The House’s $56 billion tax-cut extension bill, which is headed to a floor vote soon after members return next week, doesn’t contain Katrina tax relief. But Mr. Wolf worries the House ultimately will go along with the Senate position. Bill Thomas, California Republican and chairman of the House Ways and Means Committee, is open to including Katrina relief in the final tax bill and has said that “may be the fastest way to deal with it.”

Mr. Wolf’s draft letter to House Republican leaders says Congress has excluded certain businesses from redevelopment tax relief in the past and must do so now — especially to save precious dollars.

“Why can’t — or more accurately why won’t — we continue to say no to using our constituents’ hard-earned tax dollars to subsidize massage parlors, liquor stores and casinos? Shouldn’t we continue that precedent, particularly at a time when we, as Republicans, are trying to rein in federal spending?” the letter says.

Mr. Wolf is still circulating the draft among Republicans, and his office wouldn’t say how many have signed on. Mr. Wolf said he likely will send it to leaders early next week.

The letter also implies possible political repercussions for the party if the casinos aren’t excluded from the final bill. It cites the recent House passage of a $50 billion spending cut bill and complains that members will have to explain slowing the growth of Medicaid, student loans and food stamps, while at the same time giving tax breaks to casinos.

“It will be virtually impossible to defend this action,” the letter states.

Mr. Wolf said everyone wants to approve Gulf Coast tax relief, but that the focus should be on rebuilding water and sewer systems, hospitals and the like.

“That’s where the money and resources ought to go,” he said.

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