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GOP leaders pull bill loaded with tax breaks

Lawmakers use military bill to benefit special interests

By Ted Barrett
CNN Washington Bureau


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WASHINGTON (CNN) -- Facing mounting pressure from both Democrats and conservative members of their own party, House Republican leaders pulled a tax bill Thursday that was designed to give tax breaks to members of the military but got bogged down with special interest provisions worth hundreds of million of dollars.

The Armed Forces Tax Fairness Act was drafted to ease the tax burden on soldiers preparing for war in Iraq by giving tax breaks for their capital gains, dependent care expenses, travel expenses, and other costs. It had wide support on both sides of the aisle.

But after Republican lawmakers tacked on additional tax breaks -- for, among others, archery and tackle box manufacturers, and non-U.S. citizens who bet on American horses at the races -- Democrats and fiscal conservatives cried foul.

GOP leaders -- who had defended each of the special provisions as necessary corrections to the tax code -- pulled the bill Thursday just as debate was getting set to begin on the floor.

GOP aides promised the bill would be back on the floor next week, but wouldn't say if it would include the special provisions.

Democrats accused Republicans of delaying tax relief for the country's men and women in uniform in order to protect their special interests. But some Republicans defended the bill with the additional tax breaks, describing it as part of the normal legislative process.


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